Byju’s founder and CEO Byju Raveendran has publicly criticized investors, alleging that the company is unable to pay salaries to its employees due to funds being locked at the insistence of a few investors. This comes after a series of recent developments, including a decision by the National Company Law Tribunal (NCLT) and resolutions passed by investors.
In a letter addressed to the employees, Raveendran expressed deep frustration over the situation, attributing the salary payment delays to a group of investors who have prevented the utilization of funds raised through a recent rights issue. The NCLT had directed Byju’s to keep the funds received from the rights issue in an escrow account until the resolution of a plea regarding “oppression and mismanagement” filed by four investors.
Raveendran lamented the impact of this decision on the company’s workforce, emphasizing the challenges faced in meeting financial obligations despite having raised capital through the rights issue. He highlighted the plight of employees, stating that the actions of a minority of investors have left them in a distressing situation.
Despite the setbacks, Raveendran assured employees that efforts are underway to address the issue and expedite salary payments. He expressed the company’s commitment to resolving the situation and restoring stability to the lives of its employees.
The recent dispute between Byju’s management and investors stems from resolutions passed at an Extraordinary General Meeting (EGM) on February 23. Investors, including Prosus, a leading global technology investor, unanimously passed resolutions calling for changes in governance, financial management, and leadership at Byju’s.
While the Karnataka High Court granted interim relief to Byju’s, allowing the EGM to proceed, the decisions made during the meeting were withheld pending further hearings. Raveendran acknowledged the successful closure of the rights issue but regretted the ongoing delays in processing employee salaries.
In conclusion, Raveendran reiterated the company’s commitment to its employees and pledged to explore all available avenues to rectify the situation swiftly. Despite the challenges, Byju’s remains focused on addressing the concerns raised by investors while ensuring the welfare of its workforce.
