Byju's To Open $200-Million Rights Issue For Opposing Investors Ahead Of EGM
In January, Byju's floated a rights issue in January to raise $200 million at an pre-money valuation in the range of $20-25 million, which is a 99% reduction in its peak valuation of $22 billion.
Ed-tech startup Byju’s is considering opening up participation to its $200-million rights issue for opposing investors such as Peak XV Partners, Chan-Zuckerberg Initiative, Prosus and General Atlantic, in an effort to call for peace amid a heated battle with its notable stakeholders.
"I have always built Byju's with a spirit of equality and equity, and it has never been my intention to leave any investor behind, regardless of their shareholding size," Founder and CEO Byju Raveendran wrote in an email to shareholders early on Friday, ahead of an extraordinary general meeting scheduled for later in the day.
NDTV Profit has seen a copy of the email.
"With this in mind, I am aware that some of our valued existing shareholders were unable to participate earlier in the rights issue. In good faith the board is considering making an offer of renounced shares to existing shareholders to ensure that there is no more dilution to their shareholding," he said.
He added that despite the "animosity shown by some of the investors in pursuing uncalled for legal actions," Byju's priority remains with existing shareholders despite "significant interest" from third parties for the rights issue.
On March 28, the National Company Law Tribunal rejected a plea by investors to halt Byju's' extraordinary general meeting that is scheduled for the next day. The Bengaluru bench of the tribunal also rejected the request to appoint an independent person to oversee the meeting.
In the email, Raveendran added that in response to the postal ballot which was announced on March 7, the resolution to increase authorised share capital has already got more than 50% votes.
In January, Byju's floated a rights issue in January to raise $200 million at an pre-money valuation in the range of $20-25 million, which is a 99% reduction in its peak valuation of $22 billion.
It is also facing at least five insolvency petitions against it in the National Company Law Tribunal, apart from a bitter battle with major investors in Byju's who have voted to oust Raveendran and reconstitute the board without Raveendran's family.