Byju's Holds EGM For Shareholders, Proposes To Set Up Board Advisory Committee: Report

During the meeting, CEO Byju Raveendran announced the formation of a Board Advisory Committee (BAC) to provide guidance on board composition and governance structure.

Byju's Founder and CEO Byju Raveendran on June 4, Tuesday held an emergency general meeting (EGM) to address shareholders on the challenges faced by the edtech unicorn. According to a Bussines Standard report, during the meeting, Raveendran announced the formation of a Board Advisory Committee (BAC) to provide guidance on board composition and governance structure. 

Raveendran also said that the next EGM in three weeks will give details about BAC’s members and composition, report said. Adding that amid mounting concerns among investors and shareholders over the challenges faced by Byju's, an extraordinary general meeting (EGM) was convened to address various issues. These included discussions on the Aakash IPO timeline, audit timeline, TLB resolution, and fundraising.

“The BAC will serve as a working group consisting of independent directors with credible backgrounds and relevant experience from diverse corporate fields. Its primary purpose will be to provide advice and guidance to the CEO on matters pertaining to the composition of the board and the governance structure suitable for a company of Byju’s scale, size, and performance aspirations,” said a source close to the development told Bussines Standard. 

Byju's management assured shareholders that ongoing negotiations with lenders for Term Loan B are progressing positively and are anticipated to result in a favorable outcome, the report said. 

“The CEO stated that active and constructive discussions have taken place, and there are reasons to be optimistic about a mutually acceptable resolution. He emphasized that both parties involved in the issue are motivated to avoid legal proceedings and seek a resolution that benefits all involved parties,” said another source, as per the report. 

A spokesperson from Byju's has clarified that reports of Byju Raveendran being asked to step down or withdraw from daily operations were false, the report further added.

As per the report, during the meeting, Ajay Goel, the CFO of Byju's, informed shareholders that the audit for certain group subsidiaries for FY22 has been completed, while audits for Aakash, WhiteHat Jr, and Think & Learn are currently underway, with a focus on optimising the timelines.

The management reaffirmed that the FY22 audit is expected to be completed by the end of September, with the FY23 audit concluding by the end of December. 

This is the second shareholder meeting that Byju's had to call amid mounting troubles. On June 24, Byju Raveendran, Ajay Goel, and Roshan Thomas, the group general counsel, conducted a virtual meeting with shareholders following the resignation of auditor Deloitte and three board members, as per the report. 

Last month, three influential directors representing major shareholders of Byju's, including GV Ravishankar of Peak XV Partners (Sequoia Capital India), Russel Dreisenstock of Prosus, and Vivian Wu of Chan Zuckerberg Initiative, resigned from the company's board due to disagreements with founder Raveendran.

On the same day, Deloitte, a globally recognised audit firm and Byju's auditor, also resigned, citing a significant delay in the release of the company's FY22 (2021-22) financial results.