As many as six shareholders of Byju’s parent company Think and Learn Private Limited have now moved a resolution to oust the founders from having control over the ed-tech firm in the midst of the financial crisis, reported PTI citing sources.
In an extraordinary general meeting, the investors of Byju’s have urged the consideration to oust all the founders from decision-making posts, including co-founder and CEO Byju Raveendran, sources aware with the development told the agency
The investors led by Dutch investment firm Prosus in the EGM notice have requested the resolution of the outstanding governance, financial mismanagement and compliance issues and the reconstitution of the Board of Directors.
“The resolutions being put forward for the EGM to consider include a request for the 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,” the notice sent to shareholders by the group of investors said.
The notice to oust the founders of the ed-tech firm has been backed by General Atlantic, Peak XV, Sofina, Chan Zuckerberg, Owl, and Sands. These shareholders jointly hold around 30 percent stake in Byju’s.
The shareholders pushed for the removal of co-founder and chief executive officer Byju Raveendran from his post at the earliest, reported Mint quoting sources. “The notice was sent after the company failed to act on an EGM requisition notice sent first in July and then in December,” a source said.
Byju’s financial crisis intensifies
Ed-tech platform Byju’s had reached its peak valuation of $22 billion in March 2022, when the demand for online education was high due to the pandemic. However, the company failed to cope up with its liabilities, with the pressure from lenders increasing.
Lenders to Byju’s filed an insolvency petition last week after the startup missed payment on a $1.2 billion loan. The firm is seeking $200 million by selling new stock to shareholders, it said on Monday. Such a move would slash its value by more than 90%.
Now, investors are seeking a reshuffle in the board and an immediate change in the top leadership of the firm, as the situation continues to look bleak for founder Byju Raveendran.
BYJU’s recently declared its financial results after a delay of about 22 months in which it reported a widening of operational loss to ₹6,679 crore in FY22, mainly due to losses incurred by subsidiaries White Hat Jr and Osmo.
(With inputs from agencies)
