Byju’s investors file oppression, mismanagement case against CEO, others | Business News – Business Standard
A group of four investors of Byju have filed a complaint of oppression and mismanagement against the company’s management with the Bengaluru bench of the NCLT, seeking to declare the founders, including CEO Byju Raveendran, unfit to run the company, and appoint a new board. .
Furthermore, the lawsuit aimed to annul the rights issue that had just been completed.
Investors, who are demanding at an extraordinary general meeting that Raveendran and his family be removed from Byju’s board over alleged “mismanagement and failures” at what was once India’s hottest tech startup, have also asked in the plea for a forensic audit of the company requested. This is evident from a lawsuit filed with the National Company Law Tribunal (NCLT) on Thursday evening.
According to the filing, the investors have sought to declare current management unfit to lead the company and appoint a new CEO and board.
The plea also wants a forensic audit and a direction to the management to share information with the investors.
Sources said the plea seeks to nullify the just-concluded $200 million claim offer and that the company should not take any corporate action that would prejudice the rights of the investors.
The petition was signed by four investors ā Prosus, GA, Sofina and Peak XV ā along with support from other shareholders including Tiger and Owl Ventures.
The plea has been filed to prevent value erosion for all shareholders and preserve value for other stakeholders ā employees and customers.
Concerns raised in the lawsuit included financial mismanagement by the founders that led to the loss of control of Aakash, default on Byju’s Alpha (TLB loan) and long-standing corporate governance issues, including failure hiring a CFO and an independent director.
Other concerns center on the āoppressive natureā of the rights offering, alleged non-compliance with regulations, āoppressive, opaqueness and deliberate defaultsā in sharing information with stakeholders and unauthorized corporate actions related to the acquisition of Singaporean edtech company Northwest Education Pte.
The plea also mentions inter-company loans on undisclosed terms and multiple insolvency petitions filed by BCCI, TLB lenders and Surfer Technologies Pvt Ltd.
(Only the headline and image of this report may have been reworked by Business Standard staff; the rest of the content is automatically generated from a syndicated feed.)
First print: February 23, 2024 | 12:54 pm IST