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regular-article-logo Saturday, 15 June 2024

Former SBI chairman Rajnish Kumar, ex-Infosys CFO Mohandas Pai sever ties with Byju’s

Think & Learn Pvt Ltd formed the advisory council in July 2023, after the board exits and concerns about corporate governance, to mentor and advise its board and CEO Byju Raveendran

Our Special Correspondent Mumbai Published 21.05.24, 11:18 AM
Rajnish Kumar.

Rajnish Kumar. Sourced by the Telegraph

Rajnish Kumar, the former State Bank of India (SBI) chairman, and Mohandas Pai, the ex-chief financial officer (CFO) of Infosys, will stop advising beleaguered edtech start-up Byju’s.

They have decided to step down from an advisory council of Byju’s parent Think & Learn Pvt Ltd (TLPL).

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TLPL formed the advisory council in July 2023, after the board exits and concerns about corporate governance, to mentor and advise its board and CEO Byju Raveendran.

Kumar and Pai said in a statement on Sunday that while their contractual agreement was set to end on June 30, 2024, they have decided not to renew it.

“Our engagement with the company as advisers was always on a fixed-term basis for a year. Based on our discussions with the founders, it was mutually decided that the tenure of the advisory council should not be extended.

“Though the formal engagement concludes, the founders and the company can always approach us for any advice. We wish the founders and the company the very best for the future,’’ they said.

Byju’s said it values the engagement with the advisers and greatly appreciates all their efforts in navigating the company through turbulent times.

“Rajnish Kumar and Mohandas Pai have provided invaluable support in the past year. The ongoing litigations by a few foreign investors have delayed our plans but their advice will be relied upon in the ongoing rebuild which I am leading,” Raveendran said.

The development comes at a time Byju’s is facing legal challenges in India and in the US: a group of four investors — Prosus, General Atlantic, Sofina, and Peak XV — along with support from other shareholders, including Tiger and Owl Ventures, had approached the National Company Law Tribunal (NCLT) against the company management and its $200 million rights issue.

Last month, the company said a proposal put forth by it for increasing its authorised share capital was approved by a majority of 55 per cent of the shareholders. It enabled the edtech firm to issue fresh shares and conclude the issue.

Raveendran had said that the approval marked a significant threshold in its ``relentless push to turn around the business beset with multiple challenges, which we are resolving one by one, slowly but surely’’.

However, the NCLT has barred the firm from using the proceeds of the rights issue. It had directed that the funds be kept in a separate escrow account and not withdrawn till it disposes of a matter.

The four investors have also alleged that Byju’s had ended up using the proceeds of the rights issue and it has therefore not complied with the NCLT order. This was denied by the start-up, which said it had completely followed the tribunal’s directions.

The matter has been listed for hearing on June 6.

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