Byju's CEO dismisses reports of ouster by investors, terms it 'exaggeration'

Only a minority group of investors voted against me, Byju Raveendran claimed in fresh letter to employees

Byju Raveendran was once worth almost $5 billion, according to reports (photo: IANS)
Byju Raveendran was once worth almost $5 billion, according to reports (photo: IANS)

NH Business Bureau

In a letter addressed to employees on 24 February, Byju's CEO Byju Raveendran quashed rumours surrounding his alleged dismissal, asserting that the management structure of the company remains unchanged. Raveendran emphasized that despite recent turbulence, it's "business as usual" at Byju’s.

Addressing the purported ousting attempts, Raveendran refuted claims made by a minority group of shareholders regarding a unanimous decision to remove him. He clarified that only a fraction, representing approximately 45 per cent of shareholding, voted in favour of the resolution during the Extraordinary General Meeting (EGM).

Moneycontrol, which reported the details of the letter, said, highlighting procedural irregularities during the EGM, Raveendran underscored that decisions made therein hold no weight until the Karnataka High Court's forthcoming hearing on 13 March.

At the crux of the conflict lies a contentious resolution brought forth by investors including Prosus, GA, Sofina, and Peak XV, advocating for the removal of Raveendran and his family from leadership positions, citing alleged mismanagement. An independent scrutineer also scrutinised the voting outcomes.

The Karnataka High Court had intervened in response to a petition filed by Think & Learn Pvt Ltd, the parent company of Byju's and ordered that any resolutions proposed for the 23 February EGM, called by select investors, be deemed invalid until the final hearing and disposition of the petition. The court had allowed the EGM to proceed as scheduled.

Byju's, in its petition under Section 9 of the Arbitration and Conciliation Act, 1996, argued that certain investors—including General Atlantic, Chan Zuckerberg Initiative and others—violated the company's Articles of Association, Shareholders’ Agreement and the Companies Act, 2013, by calling for the EGM.

The EGM was marred by disruptions and procedural hurdles. On 23 February, the EGM held online witnessed significant challenges in address critical issues such as governance reforms, financial mismanagement concerns, compliance, and leadership restructuring proposals, uncertainty pervaded the voting process amidst the backdrop of internal discord.

With the outcome of the EGM shrouded in uncertainty pending further legal proceedings, the Byju's saga underscores the complexities inherent in navigating shareholder disputes within corporate governance structures.

Preceding the EGM, a group of investors escalated the conflict by filing an oppression and mismanagement suit against Byju's management with the National Company Law Tribunal (NCLT), seeking a radical overhaul of the leadership structure, the nullification of recent rights issues, and a forensic audit of the company's accounts.

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