MUMBAI : Byju Raveendran received an extended relief from the Karnataka High Court on Wednesday, allowing him to remain at the helm of Byju’s, amid a volley of charges and countercharges between his troubled edtech company and its investors.
But that could also result in Think & Learn Pvt. Ltd, Byju’s parent company, having to wait longer to access the money it has raised via a rights issue, essential to keep the company’s operations running.
The high court extended an earlier interim protection that was to end on 13 March by a fortnight, till 28 March, keeping Byju’s investors from implementing resolutions passed at an extraordinary general meeting in late February.
A clutch of key investors in Byju’s, including Prosus NV, Peak XV Partners, General Atlantic, and Sofina SA, had voted to oust Raveendran as the chief executive officer of the company he founded, citing mismanagement. Byju’s has said the meeting was invalid without the presence of at least one of the founding members.
These four investors, who collectively hold around 25% stake in the company, have also moved the Bengaluru bench of the National Company Law Tribunal seeking a stay on Byju’s rights issue.
On Wednesday, the investors alleged that Byju’s had secured Karnataka High Court’s interim order on 22 February through fraud, and that they hadn’t been issued a notice.
Byju’s, on its part, claimed the investors had lied under oath, citing differences in the filing date of an affidavit attached to the statement of objections, according to people familiar with the developments.
Byju’s delayed paying February salaries to its staff citing its inability to access money raised from its rights issue after the NCLT asked the company to hold the funds in a separate escrow account until the matter is resolved.
Byju’s had sought to raise $200 million through the rights issue to clear its immediate liabilities and for other operational costs, but at a pre-money valuation of $20-25 million. Byju’s was not too long ago among India’s highest-valued tech companies, with an estimated worth of about $22 billion.
The company has debtors, vendors and employees–past and present–waiting to get their dues running into $180-200 million in all.
Byju’s is also facing a legal battle with lenders of its $1.2-billion Term Loan B. They have taken the company to insolvency court on charges of non-repayment and technical default and have accelerated their demand for full payment, which Byju’s is contesting.
The company is also under fire for having parked more than $533 million overseas.
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Published: 13 Mar 2024, 07:53 PM IST