HC rejects NCLT stay on Byju's $200mn rights issue

MUMBAI: The Karnataka high court on Tuesday set aside an interim order by the National Company Law Tribunal restraining Byju's from going ahead with its second rights issue, in a temporary reprieve for the troubled edtech startup. The court also sent the matter back to the NCLT for a fresh consideration. Byju's declined to comment.
In an order issued last month, the Bengaluru bench of the NCLT directed Byju's to not proceed with its second rights issue and also restrained it from using any funds that have been collected since the opening of the issue on May 13.A group of Byju's investors had argued in their petition that due to the siphoning off funds by the startup's management, the company is in "dire straits" and therefore, they should not be allowed to raise further money by going ahead with the second rights issue.
The high court allowed the writ petitions filed by Think & Learn (Byju's parent company) and Byju Raveendran against the NCLT order.
The second rights issue is part of the same issue through which the cash-starved company sought to raise $200 million.