The founder of Byjus and his family will not be present at the investor-called EGM on February 23

The founder of Byjus and his family will not be present at the investor-called EGM on February 23

"This EGM is procedurally invalid, contractually in violation of our AOA plus SHA, as well as legally on the wrong side of the Companies Act, 2013," a BYJU spokeswoman said. In the event that it is summoned again, it will not have the necessary quorum and cannot continue.

On February 23, the investors of the troubled edtech business Byju's announced that founder Byju Raveendran and several board members, including his brother Riju Raveendran and wife Divya Gokulnath, would not be present at the extraordinary general meeting (EGM). to remove senior management.

"This EGM is legally in violation of the Companies Act of 2013, administratively invalid, as well as contractually in violation of our AOA and SHA." No board member, including Byju Raveendran, will be present at this illegitimate EGM. Thus, the EGM In the event that it is called, there won't be a quorum, thus the agenda items cannot be discussed or put to a vote. A representative for BYJU said that the university follows the legal processes in place as a sponsor. Furthermore, it is the founders' duty to uphold the company's integrity.

On the other hand, sources close to investors said that the EGM was lawful and would go according to schedule. Additionally, he said that "it would be incorrect to say that the EGM's quorum won't be complete if the founders are not present."

This occurred when the company's investors, including Prosus, General Atlantic, Peak XV, Sofina, and others, held an extraordinary general meeting with the intention of dismissing the company's executives and reorganizing the board.

Then, in order to prevent its shareholders from convening an EGM, Byju filed a petition under Section 9 of the provisions of the Arbitration and Conciliation Act.

Although the court has permitted the EGM to proceed as scheduled, it has postponed the execution of the resolutions adopted at the meeting until the petition's final hearing in March.

In a shareholder letter earlier this week, Raveendran announced that Byju's rights offer to fund $200 million at a value discount of 99% had received complete subscriptions.

According to sources, the company's founders want to put up between $45 and $46 million for a rights issue in order to keep a portion of the business. Those with knowledge of the process say that several late-stage investors eager to be involved in the project also arrived after the investment round.

In the letter, Raveendran pledged that, should the FY2013 audit be completed before the end of the quarter, the board will be reconstituted with the founder and shareholders' permission and that two non-executive directors would be appointed.

Once the most valued company in India, Byju's has been under scrutiny since the beginning of 2022 for a number of reasons, including purported course misrepresentation, financial problems, and huge layoffs.

Over the last 12 months, the firm has let go of thousands of workers as it struggles to deal with the combined effects of dwindling demand for online learning services and a shortage of venture capital investment. Members of its investor board have now quit the company, claiming disagreements with Raveendran.

Since then, the business has made an effort to address some of the issues. Ranjan Pai, one of its original investors, contributed money, formed an advisory board with notables like Mohandas Pai and Rajneesh Kumar, and appointed Arjun Mohan as CEO. Additionally, discussions are underway to sell assets like Epic and Great Learning.