February 28, 2024
2 mins read

Byju’s Fund Misuse Claims Surface

Byju’s key investors — Prosus, General Atlantic, Sofina and Peak XV — have moved the tribunal against the embattled edtech major over its $200 million rights issue….reports Asian Lite News

Key investors in Byju’s alleged on Tuesday that the Enforcement Directorate (ED) is investigating diversion of funds of over $500 million by the edtech company to a hedge fund in the US.

In the ongoing hearing at the National Company Law Tribunal (NCLT) in Bengaluru, the investors alleged that the address of the hedge fund was a “pancake shop” and its founder “is a 23-year-old without any training”.

“About $533 million has been siphoned off. He (Byju Raveendran) wants us to invest more money. How will we be protected?”

Byju’s key investors — Prosus, General Atlantic, Sofina and Peak XV — have moved the tribunal against the embattled edtech major over its $200 million rights issue.

During the hearing, the investors claimed that “if the amount is parked in their bank account especially when the man is sitting abroad and is not coming to India, it will become irreversible”.

Earlier in the day, the investors argued that the process adopted by Byju’s for its $200 million rights issue is “in breach of laws”.

They said that the board of directors had to call an Extraordinary General Meeting (EGM) of shareholders before the rights issue so that they could vote.

“The board of directors did not call a general body meeting before rights issues as they are aware that the general body is not in their favour,” argued the lawyer on investors’ behalf.

“Our 25.4 per cent stake will come down to 2.5 per cent if we don’t subscribe to the rights issue. If we subscribe, we don’t know what happens to our money,” the investors said.

Byju’s argued that the investors were “forum shopping” by approaching the NCLT.

“If the NCLT passes any order today, it will dilute the order of Karnataka HC,” the company’s lawyer said.

“The investors are not looking at the interest of 100 million students and the 12,000 employees but only at their value maximisation.”

“It has been 21 months since our last capital raise,” the company added.

ALSO READ: ‘Regulations Propel India to Fintech Pinnacle’

Previous Story

Goyal Calls for Manufacturing Expansion

Next Story

AirAsia Eyes Expansion

Latest from Business

RBI Holds Rates, Boosts Outlook

One of the most significant announcements was the upward revision of India’s GDP growth forecast for FY 2025–26—from 6.5% to 6.8% In a move reflecting cautious optimism, the Reserve Bank of India

Nykaa Expands Global Footprint with UK Debut

To commemorate this significant global debut, Nykaa’s leadership hosted an exclusive soiree at the George Club in Mayfair, London Nykaa, India’s leading beauty and lifestyle destination, is set to make a grand

Nothing’s CMF Goes Indian with $100M JV

Company has announced a $100 million joint venture with Indian electronics manufacturer Optiemus Infracom Limited….reports Asian Lite News Smartphone maker Nothing has spun off its budget sub-brand CMF into an independent subsidiary,

Airbnb Boosts India Economy

Among international guests, the largest inbound sources were the United States, United Kingdom, Canada, and Australia Hospitality giant Airbnb made a significant impact on India’s economy in 2024, contributing Rs 113 billion

Rupee, Markets Gain Amid Trade Optimism

Emerging market currencies, including the rupee, have gained support amid softening in the dollar. Reports suggesting that the US economy is on the verge of a recession have contributed to the greenback’s
Go toTop

Don't Miss

BYJU’S named official sponsor of FIFA World Cup

With 150 million learners around the world, BYJU’S has been

Byju’s saga maybe a lesson to learn from

The company, which has sacked thousands of employees to date