Ahead of Friday’s extraordinary general meeting (EGM), Byju’s Chief Executive Officer Baiju Raveendran told shareholders that he is committed to restructuring the edtech firm’s board of directors. He also committed to appoint two non-executive directors to the board of directors with the mutual consent of the founder and shareholders.
The development comes at a time when a consortium of major shareholders holding more than 30 per cent stake in Byju’s had this month issued a notice to the embattled edtech firm, calling for an extraordinary general meeting to deal with ‘persistent issues’ (EGM) was called for. This also includes proposed changes in the management of the company.
These shareholders will vote in an effort to replace the company’s current board of directors, including asking Byju’s Raveendran to step down as chief executive and give up his operational role at the firm, the sources said.
‘My duty to my shareholders still remains steadfast,’ Raveendran said in a letter addressed to shareholders. He said, ‘To enhance shareholder representation, I am committed to reconstituting the Board of Directors with the mutual consent of the Founder and Shareholders and appointing two non-executive directors on the Board of Directors.’
This will be done right after the FY23 audit. It is expected that the company will complete it by the end of this quarter. This initiative will enable greater engagement with shareholders.
The current board of directors of Byju’s parent company Think & Learn includes Raveendran, his wife and Byju’s co-founder Divya Gokulnath and his brother Riju Raveendran.
Byju’s, which is facing cash crunch, has recently taken the step of raising $200 million through a rights issue for all its equity shareholders. This will provide the company with the capital it needs to ensure it can take care of its current liabilities and support growth.
According to sources, if Byju’s raises $200 million, then its valuation will be between $230 million to $250 million, which is 99 percent less than the company’s valuation of $22 billion in the year 2022.
Raveendran told shareholders that the rights issue has been fully subscribed, but my benchmark of success is the participation of all shareholders in this rights issue.
He said, ‘We have built this company together and I want all of us to participate in this new mission. Your initial investment laid the foundation of our journey and this rights issue will help preserve and create greater value for all shareholders.
First Published – February 21, 2024 | 10:38 PM IST
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