Amid the reports of a section of shareholders seeking the ouster of BYJU'S founder and CEO Byju Raveendran during the much-awaited extraordinary general meeting (EGM) on Friday, the ed-tech major BYJU'S has announced that its $200 million rights issue has been fully subscribed.

"Rights issue is fully subscribed and my gratitude to my shareholders remains strong," Byju Raveendran, in a letter to shareholders, seen by Fortune India, says. However, the CEO of the unicorn startup says his benchmark of success is the “participation of all shareholders” in the rights issue, possibly hinting at some of the miffed shareholders who have sought EGM on Friday.

The agendas for Friday's EGM are issues related to the outstanding governance, financial mismanagement and restructuring of BYJU’S board. Some of the shareholders are reportedly also seeking the ouster of Raveendran, though the company has said they have no such right.

The three board members of BYJU's Byju Raveendran, his wife Divya Gokulnath and brother Riju Raveendran hold around 26% of the company.

Raveendran in his letter says the $200 million raise will give BYJU's the capital it needs to ensure it can take care of the current liabilities and provide growth capital. "I understand that participating in this rights issue may seem like a Hobson’s choice. However, this is the only viable option in front of us today to prevent permanent value erosion...We remain, as we have been, "bloodied, yet unbowed"," Raveendran's letter to shareholders says.

BYJU's had floated a $200 million rights issue in January 2024 at an enterprise valuation of $220-250 million, which is a whopping 99% down from 2022 when the company was valued at $22 billion.

He says a lot of "media speculation" has come about the pricing of the rights issue. Basis discussions, the BYJU's board decided on a price that would be attractive to all shareholders without straining them, he says. "Our aim is for all shareholders to participate in this. We chose a rights issue as the most equitable way of raising capital without needing to ascribe a valuation."

He says a right issue is a well-established element of corporate capital raises, and that the ownership of the company does not change pre and post the rights issue. "So the question of valuation itself is irrelevant as value preservation is maintained," he says.

He says as the largest shareholder and provider of capital to BYJU's, it would have been in his best interest to price the rights issue high. "But that would not be in the best interest of the company."

On the issue of shareholder representation in the company board, Raveendran says BYJU’s will commit to restructuring the board and appointing two non-executive directors by the "mutual consent of the founder and shareholders, right after the FY23 audit, which we expect to close by the end of this quarter".

Despite continuous negative coverage of the company of late, BYJU's CEO accepts the negativity has "affected perception" of the brand, but consumer belief continues to grow. "We are launching Byjus Wiz, an AI-powered tool designed to be a true study companion for students. Our AI model, trained with our proprietary data generated over the last 8 years and integrated with the Geogebra's math engine, delivers an impressive 99% accuracy in answers, surpassing any other model currently available globally."

As per Raveendran, he has personally invested $1.1 billion in the company over the last two years to pay salaries and maintain operations. "I say this with the confidence of the bootstrapped founder from ten years ago who took his startup from 0 to $22 billion with his blood, sweat and tears."

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