To Address Liquidity Crunch, BYJU'S Secures Shareholders Approval On Rights Issue

BYJU's proposed increase in authorised share capital aims to address the liquidity crunch, encompassing unpaid salaries, regulatory dues, and vendor payments

BYJU'S on Monday announced that the proposed increase in authorised share capital has been approved by a majority 55 per cent of the total votes polled. The decision was made following a postal ballot and an Extraordinary General Meeting (EGM) held on March 29, 2024. The voting process, including both the EGM and the postal ballot, concluded on April 6, 2024, and was meticulously scrutinised by an independent third party.

The approval of the EGM proposals clears the path for Think & Learn Private Limited, the parent company of BYJU'S, to issue fresh shares and finalise the rights issue. This initiative aims to address the liquidity crunch, encompassing unpaid salaries, regulatory dues, and vendor payments. Notably, these delays were attributed to irrational hostility from four foreign shareholders who opted for frivolous litigation over constructive dialogue.

Expressing gratitude to investors for their support, Byju Raveendran, founder and CEO of BYJU’S, highlighted the significance of the shareholder approval in facilitating the company's growth trajectory. "The shareholder approval marks a significant threshold in our relentless push to turn around the business beset with multiple challenges, which we are resolving one by one, slowly but surely," he said.

An independent scrutiniser rigorously evaluated the process in compliance with applicable laws, ensuring transparency and fairness throughout.

Despite the successful rights issue, BYJU'S is currently unable to utilise the proceeds due to an interim order from the National Company Law Tribunal (NCLT). The order, issued on a petition filed by four foreign shareholders, instructs the company to hold the funds received from the rights issue in an escrow account. The next hearing on the matter is scheduled for April 23.

The impending completion of the rights issue will pave the way for the launch of BYJU’S 3.0, touted as the world’s most advanced suite of AI-first products aimed at hyper-personalizing education on a global scale.