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Shareholders of the Indian edtech firm Byju’s, which include tech investors Prosus and Peak XV Partners, convened on Friday to remove its founder and CEO, Byju Raveendran, according to a statement by Prosus.

However, a valid quorum requires the presence of at least one founder-director but Byju’s CEO Raveendran, along with his wife and brother, were absent from the meeting.

Also read: Byju’s investors unanimously vote to oust founders, revamp board

“As the founders did not participate in the meeting, the quorum was never legitimately established, rendering the resolutions null and void,” Byju’s said.

The edtech company further added, “These resolutions were voted upon without the valid constitution of a quorum, as stipulated in Byju’s Articles of Association. According to Articles 38 and 39(a) of the AoA, at least one founder-director is required to form a valid quorum.”

“As the founders did not participate in the meeting, the quorum was never legitimately established, rendering the resolutions null and void,” it said.

During the Extraordinary General Meeting (EGM) held on Friday, numerous employees from Byju’s participated by accessing the meeting link, resulting in disruptions at the outset. According to a source familiar with the EGM proceedings, some employees appealed to the investor consortium not to take action against Raveendran.

Also read: Byju’s investor consortium moves NCLT against rights issue

On the other hand, at least two dozen investors, including Prosus, General Atlantic, Sofina, and Peak XV Partners attended the meeting on Friday.

“At today’s extraordinary general meeting shareholders unanimously passed all resolutions put forward for vote,” Netherlands-based Prosus, the second-largest stakeholder in Byju’s with more than a 9% share, Prosus said in a statement, who holds 9.6% stake in the edtech company.

It further added, “As shareholders and significant investors, we are confident in our position on the validity of the EGM meeting and its decisive outcome, which we will now present to the Karnataka High Court in line with due process.”

Prior to the shareholder meeting, Byju’s had sought relief from the Karnataka State High Court. The court, in its ruling on Wednesday, stipulated that any resolutions passed by the shareholders would remain ineffective until a subsequent hearing scheduled for March 13.

Subsequently, the investors plan to bring forth the decisions made during the Extraordinary General Meeting (EGM) before the Karnataka court. “As shareholders and substantial investors, we maintain confidence in the legitimacy of the EGM gathering and its conclusive results,” stated Prosus in its announcement.

 

 

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Published: 23 Feb 2024, 09:36 PM IST

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