Updated February 22nd, 2024 at 01:47 IST

Karnataka HC halts BYJU'S investors from actioning EGM decisions till next hearing

The embattled edtech was granted relief ahead of the February 23 EGM by investors including General Atlantic, Peak XV

Reported by: Business Desk
Embattled ed-tech giant Byju's on Saturday reported audited results for 2022, but only for its core business | Image:Byju's
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Temporary relief: The High Court of Karnataka has ruled in favour of embattled edtech BYJU’S, invalidating any resolution passed by investors in the February 23 extraordinary general meeting (EGM).

Think & Learn Private Limited, the parent company of BYJU’S had petitioned against some of its investors, including General Atlantic, Chan Zuckerberg Initiative, MIH EdTech Investments, Own Ventures, Peak XV Partners (formerly Sequoia Capital India & SEA), SCI Investments, SCHF PV Mauritius, Sands Capital Global Innovation Fund, Sofina, and T. Rowe Price Associates, it said in a statement.

BYJU'S $200 million rights issue was fully subscribed, Raveendran said in a shareholder letter as per reports, adding that a third-party agency would be responsible to keep a watch on funds.

According to BYJU'S, the EGM called by select investors was an attempt to disrupt the company's operations and deprive it of urgently needed capital. 

“The purported reasons for the EGM, including the removal of Byju Raveendran as CEO and Chairman, as well as Divya Gokulnath and Riju Raveendran as Directors, were merely a smokescreen designed to disrupt the management, control, and functioning of the company,” the company highlighted in its petition.

The company remains confident in its ability to navigate the current challenges and thanks all its shareholders for their overwhelming participation in the ongoing rights issue, it added.

In a bid to enhance transparency, BYJU'S offered for the appointment of two independent directors after declaring its 2023 financial results, as per the sources cited by PTI.

A failure in dissenting investors participating could significantly reduce their shareholding, almost halving it, according to the company's estimates.

Byju Raveendran has committed $45-$46 million in rights issue to preserve his shareholding in the company, as per reports. The company said its monthly payroll expenses amount to an estimated Rs 70 crore.

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Published February 22nd, 2024 at 01:47 IST