On Friday, an Extraordinary General Meeting (EGM) of Byju's shareholders began to vote on a resolution proposed by some investors to remove founder CEO Byju Raveendran and his family for alleged "mismanagement and failures".
Raveendran and his family refused to attend the EGM, claiming it was "procedurally invalid." Ahead of the EGM, a group of four Byju's investors filed an oppression and mismanagement suit against the company's management in the NCLT's Bengaluru bench on Thursday evening, seeking the declaration of founders, including CEO Byju Raveendran, as unfit to run the company, the appointment of a new board, the voiding of the recently concluded rights issue, and a forensic audit of accounts.
According to sources with firsthand knowledge of the situation, the EGM was scheduled to begin at 0930 hours on Friday morning but was delayed by about an hour as approximately 200 persons, some of whom are Byju employees, attempted to attend the virtual meeting.
Only after proper verification were the investors escorted in, they said, adding that some 40 people representing the investors were permitted in and will vote on the resolution proposed by some of them.
However, the decision of the EGM vote will not be valid until March 13, when the Karnataka High Court will hear Raveendran's appeal against the request by certain investors.
The High Court on Wednesday refused to halt the EGM, which was called by shareholders who collectively own more than 32% of Byju's. Raveendran and his family hold 26.3 percent of the corporation.
The EGM notification demands for the removal of the present board of Think & Learn, the company that manages Byju's, which includes Raveendran, his wife and co-founder Divya Gokulnath, and his brother Riju Raveendran.
Byju Raveendran, for his part, wrote to shareholders for the second time in a week, saying the EGM was "procedurally invalid, contractually in contravention" of the articles of association and shareholder agreement, "legally on the wrong side of the Companies Act, 2013, and fundamentally designed and timed to create a media circus around it".
