Byju Raveendran, the embattled founder of Byju's education app, has won a temporary reprieve in his tussle with a section of shareholders for control of the company he founded in 2011. Raveendran got interim relief from Karnataka High Court on Wednesday as the Court stayed the effect of decisions that could be taken during the upcoming extraordinary general meeting (EGM) of the shareholders of Byju's slated for February 23, according to Bar & Bench.
The order effectively protects Raveendran from possible ouster. The shareholder meeting has been called by key investors and shareholders of Byju’s including Chan Zuckerberg Initiative, General Atlantic, Prosus Ventures and Peak XV to discuss change in the company’s leadership.
The investors called for an EGM for February 23 by issuing a notice under section 100(3) of the Companies Act prompting Byju's to approach the Court.
However, the court observed that the conditions for convening the EGM had not been complied with.
"The conditions for convening an EGM are not complied and no notice is issued as contemplated under Section 100(3) of the Companies Act. Considering the submissions made and perusal of the records, this Court is of the view that the interim order is required to be passed. The decision, if any taken by the shareholders of Byju’s in EGM scheduled on February 23 shall not be given effect till the next date of hearing," the Court said.
The case will resume on March 13th. In the meantime, some lenders have filed insolvency proceedings against Byju's with the National Company Law Tribunal (NCLT).
Interestingly, Byju Raveendran did make a conciliatory offer to shareholders on Wednesday, promising changes to the board soon and an oversight committee to monitor the spending on recently raised funds.