MUMBAI : Think & Learn Pvt. Ltd, the parent of edtech firm Byju’s, said it has secured an order from the Karnataka High Court stating that any resolutions proposed in an emergency meeting called by some of its key investors would be invalid until a final hearing by the court.
A spokesperson for the investors said the EGM would continue on Friday, and that they would to go ahead for a vote to remove Raveendran as CEO.
The high court has not declared the meeting as illegal, not has it invalidated the resolutions of the EGM, the spokesperson said.
Key investors of the company, including General Atlantic, Prosus Ventures, Peak XV and Chan Zuckerberg Initiative, have called for an extraordinary general meeting on 23 February seeking to change the company’s leadership, including the ouster of co-founder and CEO Byju Raveendran, reconstitute the company’s board, and address financial management and governance issues.
“This development marks a significant victory for Byju’s, with the court recognizing the urgent need to protect the company’s interests and uphold the principles established by law,” the company said in a statement on Wednesday.
The investors are likely to weigh all options before responding, a person with knowledge of the development said.
The investors were not immediately available for a comment.
Byju’s filed its petition before the Karnataka High Court under Section 9 of The Arbitration and Conciliation Act, 1996, arguing that certain investors had violated the Articles of Association (AoA), the Shareholders’ Agreement (SHA), and the Companies Act, 2013 by calling for an EGM.
“In its petition, Byju’S highlighted that the purported reasons for the EGM, including the removal of Byju Raveendran as CEO and Chairman, as well as Divya Gokulnath and Riju Raveendran as Directors, were merely a smokescreen designed to disrupt the management, control, and functioning of the company,” Byju’s said in the statement.
“The company firmly argued that the proposed EGM was vexacious and devoid of merit, put forward to disrupt the ongoing rights issue which offers all shareholders an equal opportunity to maintain their shareholding in the company via participation,” it added.
Earlier on Wednesday, Byju’s said its $200-million rights issue was fully subscribed. Key investors including General Atlantic, Prosus Ventures, Peak XV and Chan Zuckerberg Initiative, holding a combined 30% stake in Think & Learn, had called for the EGM on 1 February after Byju’s announced plans for the rights issue.
Key investors holding a combined 30% stake in Think & Learn called for the special meeting after two unsuccessful attempts to drive changes in the management. As per their joint statement on 1 February, they had requested for an EGM in July as well as in December. On both occasions, the company had not taken the investors’ call for an EGM into account.
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Published: 21 Feb 2024, 09:39 PM IST