The National Company Law Tribunal (NCLT) in Bengaluru has declined to grant a stay on Byju's extraordinary general meeting (EGM) scheduled for March 29. The EGM aims to increase the edtech company's share capital in connection with a $200 million rights issue.
Investors led by Prosus had approached the NCLT seeking a stay on the EGM and to block the rights issue. However, the tribunal refused to impose a stay and set the next hearing for April 4.
The tribunal also directed Byju's to provide investors with all relevant information related to the company's financials, including details of the rights issue. Prosus, General Atlantic, Peak XV Partners, and Sofina, four of Byju's investors, had requested the tribunal to halt the rights issue.
The NCLT had previously instructed Byju's to deposit the funds raised from the rights issue into a separate escrow account and refrain from withdrawing them until the matter is resolved.
Byju's, once a highly successful Indian startup, has faced several challenges since 2023. These include the resignation of its auditor, bankruptcy proceedings initiated by lenders against a holding company, and a US lawsuit contesting the terms and repayment of a loan. Earlier this year, investors voted to remove CEO Byju Raveendran due to concerns about governance, financial mismanagement, and compliance issues. In 2022, Byju's was valued at $22 billion.