Byju’s says investors don’t have voting right to remove founder from edtech group
Following months of behind-the-scenes conflict, Byju’s and some of its biggest investors are now publicly airing their complaints about one another.
Byju’s, once India’s most valuable startup, said Friday its investors do not have the voting right to seek leadership changes, a day after a group of shareholders called for an extraordinary general meeting to remove founder Byju Raveendran and his family from the top roles at the edtech group.
In a press release, Byju’s said it will continue its deliberation to raise $200 million in a rights issue, for which it has received “encouraging responses from multiple investors.”
Separately, Byju’s leadership informed the employees earlier Friday that the ongoing rights issue has already received commitments for “more than 100 percent of the proposed amount.” They blamed investors for “seeing the crisis” as an “opportunity to conspire” and demand the removal of Raveendran.
The leadership at Byju’s also blamed the “artificially induced crisis” by select investors for the “slight delay” in making the January payroll.
Investors including Prosus, General Atlantic, Peak XV and Chan Zuckerberg Initiative said in a statement Thursday that they seek a resolution of the “outstanding governance, financial mismanagement and compliance issues; the reconstitution of the Board of Directors, so that it is no longer controlled by the founders of T&L; and a change in leadership of the Company.”
This is the third time the investors have sought an extraordinary general meeting (EGM). The new request follows Byju’s launching the rights issue to raise capital it said was essential for its survival. The Bengaluru-headquartered startup, once valued at $22 billion and which has raised over $5 billion, reset its valuation to $25 million in the rights issue.
