EGM byjus Financial Issue: The outcome of the vote at the EGM will not be applicable until March 13, when the Karnataka High Court will next hear Raveendran’s plea challenging the move by certain investors.
EGM byjus Financial Issue:An Extraordinary General Meeting (EGM) of Byju’s shareholders got underway on Friday to vote on a resolution brought by some investors to oust founder CEO Byju Raveendran and his family over alleged “mismanagement and failures”.
What is EGM byjus Financial Issue?
Raveendran and his family avoided the EGM, calling it “procedurally invalid.” Ahead of the EGM, a group of four investors of Byju’s on Thursday evening filed an oppression and mismanagement suit against the company’s management in the Bengaluru bench of the NCLT, seeking the declaration of founders, including CEO Byju Raveendran, as unfit to run the company, appointment of a new board, declaring the just-concluded rights issue as void, and forensic audit of accounts.
EGM byjus Financial Issue:Sources with direct knowledge of the matter said the EGM was to start at 0930 hours on Friday morning but was delayed for almost an hour as some 200 people, some of them Byju’s employees, sought to join the virtual meet.
Only after due verification were the investors led in, they added that some 40 people representing the investors were allowed in and would vote on the resolution moved by some investors.
However, the outcome of the vote at the EGM will not be applicable until March 13, when the Karnataka High Court will next hear Raveendran’s plea challenging the move by certain investors.
On Wednesday, the High Court refused to stay the EGM, which was called by shareholders collectively holding more than 32 percent stake in Byju’s. Raveendran and their family own 26.3 percent of the company.
The EGM notice calls for the ouster of the current board of Think & Learn, the firm that operates Byju’s, composed of Raveendran, his wife and co-founder Divya Gokulnath, and his brother Riju Raveendran.
EGM Proceedings
Byju Raveendran, for his part, wrote to shareholders for the second time in a week saying the EGM was “procedurally invalid, contractually in contravention” of the articles of association and shareholder agreement, “legally on the wrong side of the Companies Act, 2013, and fundamentally designed and timed to create a media circus around it”.
A few hours before the EGM, Byju’s reached out to the dissenting investors, urging them to join the rights issue within 72 hours. The peace offering was reportedly extended to the four dissenters.
How Many Members Attended EGM?
EGM byjus Financial Issue:About 20 investor representatives were in attendance, along with Think & Learn management. In a letter to shareholders, Raveendran said the company had received more than 50 percent of votes in favor of increasing the authorized share capital.
The result of the rights issue won’t be out till April 6. “I have always built Byju’s with a spirit of equality and equity, and it has never been my intention to leave any investor behind, regardless of their shareholding size,” Raveendran wrote in the letter. “From the very inception of this company, my vision has been to take everyone along, from one milestone to another. And it has always been my conviction that we will overcome our challenges together.”
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