Mumbai: On Friday, shareholders of Byju’s parent company Think & Learn are expected to gather for a special meeting called by a group of investors to oust them. edtech startupThe founder led the board of Byju Raveendran,
To oust the three-member board comprising Raveendran, his wife Divya Gokulnath and his brother Riju Raveendran, a majority (50% plus one share) of the votes cast must be in favor of the proposal. Raveendran and his family are the largest shareholders with 26. % stake in Byju’s, will vote against the proposal.
As per rules, two members must be present at an extraordinary meeting (EGM) to complete the quorum of the meeting. In the case of BYJU’s, its articles of association stipulate the presence of its promoter-director at the EGM and if the person does not turn up to the meeting, the EGM can be adjourned for a week. In an adjourned EGM, even if the promoter-director is not present, the shareholders present at the meeting can complete the quorum.
The group of investors, who have called the EGM and hold more than 25% stake in Byju’s, will not participate in the meeting as they do not have voting rights. This is because they signed a shareholder agreement that does not give them voting rights. A source close to Byju’s said three of the dissenting investors were on the company’s board until last year, although they had no rights to board seats.
Other shareholders own more than 45% of Byju’s, which was once India’s most valuable startup. All investors individually hold a one-digit stake in the company, while investors do not need voting rights to call an EGM, the source said, adding that “voting on specific matters has been segregated”.
Matters of the EGM will include resolution of outstanding governance, financial mismanagement and compliance issues, reconstitution of the board so that it is no longer controlled by the founders and change in the leadership of the company. Investors also have the option to approach the company law tribunal against Byju’s and its board over minority shareholder oppression and mismanagement of the edtech firm’s affairs, lawyers said.
To oust the three-member board comprising Raveendran, his wife Divya Gokulnath and his brother Riju Raveendran, a majority (50% plus one share) of the votes cast must be in favor of the proposal. Raveendran and his family are the largest shareholders with 26. % stake in Byju’s, will vote against the proposal.
As per rules, two members must be present at an extraordinary meeting (EGM) to complete the quorum of the meeting. In the case of BYJU’s, its articles of association stipulate the presence of its promoter-director at the EGM and if the person does not turn up to the meeting, the EGM can be adjourned for a week. In an adjourned EGM, even if the promoter-director is not present, the shareholders present at the meeting can complete the quorum.
The group of investors, who have called the EGM and hold more than 25% stake in Byju’s, will not participate in the meeting as they do not have voting rights. This is because they signed a shareholder agreement that does not give them voting rights. A source close to Byju’s said three of the dissenting investors were on the company’s board until last year, although they had no rights to board seats.
Other shareholders own more than 45% of Byju’s, which was once India’s most valuable startup. All investors individually hold a one-digit stake in the company, while investors do not need voting rights to call an EGM, the source said, adding that “voting on specific matters has been segregated”.
Matters of the EGM will include resolution of outstanding governance, financial mismanagement and compliance issues, reconstitution of the board so that it is no longer controlled by the founders and change in the leadership of the company. Investors also have the option to approach the company law tribunal against Byju’s and its board over minority shareholder oppression and mismanagement of the edtech firm’s affairs, lawyers said.
