Byju’s $200 million rights issue, reducing valuation by 99%, fully subscribed
- ByStartupStory | February 21, 2024
Ahead of a highly anticipated extraordinary general meeting (EGM), Byju’s $200 million rights issue, aimed at raising funds, has garnered full subscription. Founder Byju Raveendran is set to invest $45-$46 million in the rights issue to maintain his shareholding in the company. Late-stage investors may also participate in the funding round.
Byju’s largest investors have called for an EGM, scheduled for Friday, seeking leadership changes and board restructuring. The investors allege financial mismanagement and value erosion, prompting the demand for governance reforms.
“The resolutions being put forward for the EGM to consider include a request for the resolution of governance, financial mismanagement, and compliance issues,” stated the investor group.
Byju’s shareholders have until February 29 to participate in the rights issue or face potential stake dilution.
“Our rights issue is fully subscribed, and my gratitude to my shareholders remains strong,” said Byju Raveendran, founder and CEO of Byju’s, expressing appreciation for shareholders’ support.
Raveendran urged shareholders to participate in the rights issue, emphasizing its significance in preventing permanent value erosion. He stressed the importance of unity among shareholders for the company’s well-being.
“I understand that participating in this rights issue may seem like a Hobson’s choice,” remarked Raveendran, highlighting the necessity of collective action for the company’s success.
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