Updated February 22nd, 2024 at 22:51 IST

Byju Raveendran will not attend EGM tomorrow: BYJU'S

The February 23 EGM is called by investors PeakXV, Chan Zuckerberg Initiative and others

Reported by: Business Desk
Byju Raveendran | Image:Instagram
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No show: Byju Raveendran will not attend the extraordinary general meeting (EGM) called on February 23, BYJU'S has officially stated.

The development comes amid reports of the Enforcement Directorate issuing a lookout notice for the embattled edtech's founder, who is said to be currently based in Dubai.

“This EGM is procedurally invalid, contractually in contravention of our AOA and SHA, legally on the wrong side of the Companies Act, 2013. Byju Raveendran or any other Board member will not attend this invalid EGM,” a BYJU'S spokesperson said.

The Karnataka High Court had refused to put a stay on the EGM to be held tomorrow, which was called by select investors including PeakXV, Chan Zuckerberg and others. One of the agenda items in the meeting is a proposal to oust Raveendran from the board of BYJU'S, along with his wife Divya Gokulnath and brother, for alleged financial mismanagement, erosion of value due to management's failure to enforce the company's legal rights and concealment of material information.

But the absence of BYJU'S from the meeting “means the EGM, if it is still summoned, will not have the required quorum and cannot proceed to discuss or vote on the agenda,” the spokesperson said, adding that as custodians of BYJU'S, it is the  responsibility of the founders to "respect the established procedures of law and protect the company's integrity.” 

The EGM notice details alleged financial mismanagement, stating that the company management could not explain about the show cause notice by the ED on alleged contraventions, as well as the failure to resolve the $1.2 billion term-loan with its lenders. There is also a conflict BYJU'S faces with BCCI over cricket sponsorship. Raveendran has also been accused of allegedly misleading shareholders about the term-loan.

Byju's was earlier valued at $22 billion in 2022, which is now valued at $200 million according to the rights issue rolled out by the company, which was fully subscribed. 

Raveendran has written to investors this week about more steps he is taking to ensure transparency on the utlisation of funds, as well as remaining committed to restructuring the board which includes the appointment of two non-executive directors to the board by mutual consent of the founder and shareholders.

 

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Published February 22nd, 2024 at 21:05 IST