Byju’s shareholders convened on Friday to vote unanimously for the removal of founder CEO Byju Raveendran and his family from the board, citing alleged "mismanagement and failures" at the once high-flying Indian tech startup. However, the company rebuffed the voting process, labeling it invalid and ineffective due to the absence of the founders.
Founder CEO Raveendran, along with his wife and brother—currently the sole members on the company's board—opted to abstain from the extraordinary general meeting (EGM) organized by a consortium of six investors holding over 32% stake in Think & Learn (T&L), the entity behind the online education platform Byju’s.
Despite their absence, over 60% of shareholders reportedly supported all seven resolutions presented at the EGM, which included calls for the removal of the existing management, board restructuring, and a third-party forensic investigation into the company's acquisitions.
However, Byju’s sources contested this figure, stating it to be around 47%.
Prosus, one of the investors leading the EGM initiative, announced that "shareholders unanimously passed all resolutions," emphasizing the need to address governance, financial mismanagement, and compliance issues at Byju’s, as well as advocating for a leadership change.
The EGM, initially scheduled to commence at 9:30 am, encountered a delay of nearly an hour as approximately 200 individuals, including some Byju’s employees, sought access to the virtual meeting. Following verification procedures, around 40 representatives of the investors were admitted and participated in voting on the resolutions.
However, the outcome of the EGM vote awaits validation until March 13, pending a hearing at the Karnataka High Court, where Raveendran has challenged the investors' move to convene the meeting.
Despite the shareholders' decision, Byju’s issued a preemptive statement declaring the resolutions passed during the EGM as "invalid and ineffective," citing procedural irregularities and the absence of quorum as per the company's Articles of Association (AoA).
The company criticized the EGM as a "media spectacle" orchestrated by a select group of shareholders and asserted that the resolutions lacked binding authority over the company or its decision-making processes.
Furthermore, investors filed an oppression and mismanagement suit against Byju’s management, seeking to declare the founders unfit to lead the company, appoint a new board, annul the recently concluded rights issue, and conduct a forensic audit of the company’s accounts.
While the dispute unfolds in legal arenas, Byju’s, once valued at USD 22 billion, faces mounting challenges, including auditor resignations, bankruptcy proceedings initiated by lenders against its holding company, and litigation disputes in the US over loan terms and repayment.
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