Byju's investors vote to remove founder CEO Byju Raveendran from troubled EdTech startup
Byju's rejected the resolutions, which also sought to remove Byju Raveendran from the board of the company he founded in 2015, the company said in a statement on Friday.
FollowAt an Extraordinary General Meeting (EGM), shareholders of Byju's unanimously voted for the removal of founder and CEO Byju Raveendran, along with his family, according to the announcement from shareholder Prosus.
Prosus NV and Peak XV Partners, two of Byju's largest investors, voted on Friday to remove the company's founder from his position as CEO, intensifying the conflict over the future of the formerly successful online tutoring firm that is struggling to stay in business.
The firm stated in a statement on Friday that Byju's had rejected the resolutions, which also attempted to remove Byju Raveendran from the board of the business he created in 2015.
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"The resolutions passed during the recently concluded extraordinary general meeting - attended by a small cohort of select shareholders - are invalid and ineffective," the statement states.
Meanwhile, four investors in the troubled edtech giant Byju's filed a suit against the business on Friday, Marching the Bengaluru bench of the National business Law Tribunal (NCLT) against harassment and mismanagement.
Concerns raised by the investors in the NCLT suit include the founders' financial mismanagement, which resulted in the loss of control over Aakash; Byju's Alpha (TLB loan) default; ongoing issues with corporate governance, such as the lack of a CFO and independent director; the oppressive nature of the $200 million rights offer; regulatory non-compliance; and the willful failure to share information with stakeholders.
After growing the firm too quickly during the pandemic, Raveendran, whose rise from tutor to the head of a once $22 billion corporation, charmed a country enamored with charismatic digital entrepreneurs. Now, he is resorting to increasingly desperate methods to keep the company viable. When demand for online tutoring declined when schools resumed, Byju's was taken off balance.
In order to obtain money for staff pay, Raveendran has pledged his house and those held by his family members, and several board members have resigned. In order to acquire money, it is also offering fresh stock for sale at a discount of almost 90% from its previous investment round.
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