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Four investors of the edtech firm Byju’s have filed caveats in the Supreme Court, asking to be heard before any decision on a plea that is likely to be filed against a National Company Law Tribunal (NCLT) order.
MIH Edtech Investments BV, Peak XV Partners Investments, Sofina SA and General Atlantic Singapore TL Pte Ltd filed separate caveats in the apex court on March 4, according to the sources.
“The four investors have approached the court and filed caveats, just in case Byju’s files a plea against the NCLT order,” said a person familiar with the development.
A caveat is a caution or notice to the Court not to issue any grant or take any step without notice being given to the party lodging the caveat.
The development comes at a time when the NCLT in its February 27 order directed Byju’s to keep funds received from the rights issue in an escrow account. This should be done till the disposal of the oppression and mismanagement petition filed against Byju’s by four of the company’s investors. Escrow refers to a third party that holds money or an asset on behalf of the other two parties in a transaction.
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As reported earlier, Byju’s may appeal to NCLT to allow it to use the funds. The edtech firm is unable to pay salaries to employees as the funds are currently locked in a ‘separate account’ due to the ongoing dispute with investors.
Byju’s and its investors locked horns at the NCLT on February 27 over the company’s rights issue of $200 million in a petition alleging oppression and mismanagement.
The four investors — Prosus, General Atlantic, Sofina, and Peak XV (formerly Sequoia) — had sought a stay on the rights issue at less than 99 per cent enterprise valuation compared to Byju’s peak valuation of $22 billion.
They have the support of other shareholders, including Tiger Global and Owl Ventures, according to sources. Investors contended that they have no visibility on how the rights issue money will be used.
