Aakash founder joins NCLT battle against changes to firm's AoA

Aakash was acquired by Byju’s in April 2021 for nearly $1 billion.

Jagdish Chand Chaudhary, founder of Aakash Educational Services Ltd (AESL), on March 18 moved the National Company Law Tribunal (NCLT) against an attempt to amend the company's Articles of Association (AoA), joining other shareholders in the battle against the board.

This marks the second legal battle between Aakash, a subsidiary of edtech firm Byju’s, and its minority shareholders, with founder Chaudhary joining in as well.

Blackstone-owned Singapore Topco and Glas Trust, also minority shareholders, have been trying to halt changes to the Aakash’s AoA as proposed by the board in 2024.

After a series of hearings, Singapore Topco, which holds a 6.8 percent stake in Aakash, withdrew its application, hinting that it may have reached an out-of-court settlement.

The minority shareholders alleged that amending Aakash’s AoA would possibly have Byju’s reduce/sell off its shareholding and use Aakash’s cash flows or assets to repay its debts, further escalating tensions.

They alleged that the move sought to strip them of their rights and was an attempt to reduce Byju’s control over its highly valuable asset.

Aakash has defended the changes, saying the amendment is necessary to secure funding, with Manipal Systems currently the largest shareholder.

The latest petition also make a similar argument.

The NCLT bench has issued notices to key respondents, including Blackstone-backed Singapore Topco, Byju’s co-founder Byju Raveendran and Divya Gokulnath, Byju’s brother and a stakeholder Riju Raveendran, and Manipal Group.

The next hearing is on for April 30.

Aakash, known for its nationwide coaching network for competitive exams, was acquired by Byju’s in April 2021 for nearly $1 billion.

In January 2024, Ranjan Pai’s Manipal Education and Medical Group (MEMG) invested $300 million in Aakash, acquiring a 40 percent stake by converting debt into equity.