NEW DELHI: More than 60 percent of shareholders of edutech Byju’s on Friday voted for the removal of founder CEO Byju Raveendran and his family over alleged “mismanagement and failures” at what was once India’s hottest tech startup, but the company dug in its heels, calling the voting done in the absence of founders as “invalid.”
Prosus, one of the six investors who had called the extraordinary general meeting (EGM), said in a statement that “shareholders unanimously passed all resolutions put forward for vote.”
“These included a request for the resolution of the outstanding governance, financial mismanagement and compliance issues at Byju’s; the reconstitution of the board of directors, so that it is no longer controlled by the founder of T&L; and a change of leadership of the company.”
Raveendran and his family stayed away from today’s EGM, calling it “procedurally invalid.”
Earlier in the day, a group of four investors in Byju’s filed an oppression and mismanagement suit against the management of the company before the Bengaluru bench of the NCLT, seeking the declaration of founders, including CEO Byju Raveendran, as unfit to run the company, and appointing a new board. Besides, the suit has sought to declare the just concluded rights issue as void.
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 to call the EGM.
The High Court on Wednesday had refused to stay the EGM, called by shareholders collectively holding more than 32 percent stake in Think & Learn (T&L), the firm that operates Byju’s, but any resolution passed shall not be given effect till the next date of hearing.
Raveendran and his family own 26.3 percent of the company.
Byju’s statement, issued even before the EGM results were declared, said it “firmly declares that the resolutions passed during the recently concluded EGM, attended by a small cohort of select shareholders, are invalid and ineffective. The passing of the unenforceable resolutions challenges the rule of law at worst.”
