Key Byju's investors move NCLT against edtech firm's rights issue

Investors Move NCLT Against Byju’s Over Rights Issue

New Delhi, Feb 23 (IANS) Byju’s key investors — Prosus, General Atlantic, Sofina and Peak XV — have moved the National Company Law Tribunal (NCLT) against the embattling edtech major over its rights issue, investor sources said on Friday. The venture capital firms have alleged “suppression of investor rights and mismanagement of the company” and filed a petition before the Bengaluru bench of the tribunal.

This move marks the first time Byju’s investors have legally taken action against the rights issue. Byju’s did not immediately comment on the investors’ move, but the edtech company mentioned that the rights issue was fully subscribed.

The investors are seeking relief in declaring the rights issue as void, and declaring the founders and the management as unfit to run the company. According to investor sources, the management has not shared “relevant financial information with the investor group”. The ongoing battle intensified after the edtech major informed that the company’s co-founder and CEO Byju Raveendran and Board members would not attend the extraordinary general meeting (EGM) called by select investors to oust its CEO on Friday.

This legal action taken by the investors against Byju’s over its rights issue brings to light the growing tension and concerns within the company. The outcome of this move remains to be seen and will likely have significant implications for the embattled edtech major and its stakeholders.

This legal battle between Byju’s and its investors may have long-term implications for the company’s future and the edtech industry as a whole. The outcome of the NCLT proceedings and the resolution of the conflict will be closely watched by the market and industry observers.