Byju’s, the prominent edtech group, is currently facing a public dispute with some of its major investors. The conflict has escalated to the point where the investors are seeking to remove founder Byju Raveendran and his family from their leadership roles. Byju’s, however, has asserted that its investors lack the voting right to make such a decision.
Key Takeaway
Byju’s and its investors are engaged in a public dispute, with the company asserting that its investors lack the voting right to remove the founder from his leadership role.
Byju’s Stance on Investor Rights
In response to the investors’ call for an extraordinary general meeting to oust the founder and his family from the top positions, Byju’s released a statement affirming that its investors do not possess the authority to initiate leadership changes. The company also disclosed its ongoing efforts to raise $200 million through a rights issue, which has garnered positive responses from multiple investors.
Investor Allegations and Byju’s Response
Byju’s leadership has accused certain investors of exploiting the current situation to orchestrate a conspiracy aimed at removing Raveendran. They have attributed a slight delay in the January payroll to the “artificially induced crisis” created by these investors. The company emphasized that the ongoing rights issue has already received commitments exceeding 100% of the proposed amount, underscoring the support it has garnered from a wide section of its shareholders.
Investors’ Perspective
On the other hand, investors including Prosus, General Atlantic, Peak XV, and Chan Zuckerberg Initiative have highlighted governance, financial mismanagement, and compliance issues. They have expressed the need for a reconstitution of the Board of Directors and a change in the company’s leadership. This marks the third instance where investors have sought an extraordinary general meeting to address these concerns.
