The investors had called EGM in February to oust founder Byju
BBN Bureau
New Delhi: Aggrieved investors of edtech major Think and Learn, owner of Byju’s brand, will participate in the extraordinary general meeting of the company to be held on Friday morning, sources aware of the development said on Thursday.
Byju’s EGM is scheduled to start at 10 AM IST on Friday to seek shareholders’ approval to increase the authorised share capital of the company, following the $200 million rights issue.
“Most of the investors, especially those who have gone to the NCLT, will participate in the EGM as it is the place to record their vote and raise issues,” a source from the group of discontented Byju’s investors said.
A group of four investors – Prosus, General Atlantic, Sofina, and Peak XV – along with support from other shareholders, including Tiger and Owl Ventures, have approached the National Company Law Tribunal (NCLT) against Byju’s EGM.
The source said investors want to access the financial books of Byju’s which they can get through EGM. The NCLT Bangalore bench on Thursday allowed investors to have access to Byju’s financial books.
The investors had called EGM in February to oust founder CEO Byju Raveendran and his family from the board over alleged “mismanagement and failures”.
Investor sources claimed that more than 60 per cent of the shareholders voted in favour of all the seven resolutions, which included removing the current management, reconfiguration of the board and a third-party forensic investigation into acquisitions done by the company.
However, sources close to Byju’s put the number at 47 per cent.
Byju’s has approached Karnataka High Court against the EGM called by investors to invalidate it, as the meeting was convened without following the proper procedure set out by the law and the company’s Articles of Association.
According to Byju’s, to pass any resolution, the meeting needs to have a proper quorum and a set of people who are mandatory, and as per the company’s articles, the quorum requires the presence of at least one founder director.
Byju’s sources said that the company granted investors on February 19 access to its financial books. However, they preferred to move to the NCLT against the company.
“Since the matter was sub-judice, the access to financial records was closed for them. The NCLT has now allowed access to financial books to investors. The company never objected to investors accessing financial books. Even before the rights issue they were given access to the documents, which were leaked by them to select media,” Byju’s sources said.
The resolution proposed by Byju’s will be passed if over 50 per cent of shareholders cast their votes in its favour.
Besides, voting through postal ballots is also open for investors till April 6.
The scrutinisers’ report will be prepared after the closing of postal ballots.
