Team-BHP
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https://www.team-bhp.com/forum/)
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Startup shenanigans
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https://www.team-bhp.com/forum/shifting-gears/169994-startup-shenanigans-34.html)
Quote:
Originally Posted by RT13
(Post 5725523)
They finally managed to kick him (and his cronies out)! Albeit, kicking and screaming it appears
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Not yet.
Quote:
While major investors have voted for the removal of Byju Raveendran as CEO of the company, it will remain on hold until March 13 as Byju Raveendran had filed a petition against the decision of investors to call for the EGM.
On Wednesday, the Karnataka High Court ruled that any resolutions passed during the EGM would be suspended till the next hearing, but declined to halt proceedings.
Anticipating the outcome of the EGM, Byju's had already issued a statement.
“The resolutions ratified during the recently held EGM — which saw participation from a select group of shareholders — stand as invalid and non-binding,” Byju’s said.
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I find this really strange. How can a bunch of minority shareholders defy the decision of the majority in a private limited company? And the court has gone along with it.
Quote:
Originally Posted by Samurai
(Post 5725584)
How can a bunch of minority shareholders defy the decision of the majority in a private limited company? And the court has gone along with it.
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Wow! Bizarre!! The plot thickens.
Well, not to be a hater, but we do live in incredibly troubled times and when a few billion hang in the balance, a few crores in the right (or wrong) places to delay/derail/dodge matters is nothing I suppose. If you can’t win in the boardroom, tie it up in our Byzantine legal system and you’ll buy enough time for just about anything.
Quote:
Originally Posted by Samurai
(Post 5725584)
I find this really strange. How can a bunch of minority shareholders defy the decision of the majority in a private limited company? And the court has gone along with it.
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The board now constitutes of Byju, his wife and brother. The board representation from other major investors having resigned. I suppose there still are one or two independent members.
The board meetings are now a family get together :-)
I suppose they now get a free hand with any decision they want to take. Including not calling an EGM, calling for a rights issue at 200million valuation from earlier 20+billion valuation.
If the rights issue goes through, depending on how much Byju puts up (and other skip putting in money), he may endup becoming the majority holder again!
This article details out the reasoning
https://boringmoney.in/p/investors-r...ssue-sue-byjus
Quote:
Originally Posted by whitewing
(Post 5726292)
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This is absolutely right. The thing is, under Indian Companies Act, a rights issue to all existing shareholders can be pursued with Board approval alone (it does not require shareholder approval); but a targeted placement to any investor requires shareholder approval. Once you resign from the Board, you are handing over the initiative to the founders and signaling that you are willing to write off your entire investment. Makes it harder to salvage if you have second thoughts and want to take control of the company.
Of course, Byju may run into issues with SFIO, ED, RBI and every other acronym'ed regulator around, but that's a separate matter entirely.
The latest
Fortune magazine's theme is UniCorpses. While I bookmarked my favourite articles from there, I was just thinking of all the big name companies that are going bust as the endless & mindless tap of funding has dried up.
- GoMechanic imploded
- Byjus is in the ICU
- Droom.in (who even goes there) has been talking of "cutting losses"
- PayTM is in deep trouble over its core business models
- ZestMoney shut down
We're definitely going to see a lot more bankrupt startups as some sensible thinkers enter the boardroom. I don't even understand how brands like ShopClues etc. will survive.
Happened to check what is droom.in after seeing GTOs post above. Perplexed to see that apart from bikes, scooters and cars, they also sell planes. At listed rate of Rs. 45 crore, the deal looks inviting. Description of the plane is even more fabulous - "This is a pre-owned Hawker 900XP Planes with a engine. It is a Planes". LOL.
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