Now, Aakash Founder Moves NCLT Against AoA Amendment

About a month after Singapore Topco withdrew its petition from the National Company Law Tribunal (NCLT) challenging Aakash Education Services Limited’s (AESL) resolution to amend its Articles of Association (AoA), the coaching chain’s founder Jagdish Chand Chaudhary has now moved the Tribunal against the resolution. 

Chaudhary has moved the NCLT against Aakash and 22 others, seeking to restrain the respondents from undertaking the said amendment. According to a report by Bar and Bench, a bench of NCLT Bengaluru issued notices on the plea to respondents Blackstone-backed Singapore Topco, Byju Raveendran, Riju Raveendran, Divya Gokulnath, Manipal Education & Medical Group, among others. The NCLT is scheduled to hear the case again on April 30.

It is pertinent to mention that Chaudhary sold Aakash to BYJU’S in April 2021 for nearly $1 Bn. Post the sale, he became a minority stakeholder in the company. With the petition, he has joined other stakeholders opposing the amendments to AoA. 

Earlier, Singapore Topco had moved the NCLT saying that the proposed AoA would lead to erosion of its 6.8% stake in Aakash. Later, Glas Trust, a consortium of BYJU’S US-based lenders which has been involved in a legal tussle with the troubled startup, joined Singapore Topco in opposing the AoA. 

While the former withdrew its plea challenging the AoA on February 24, Glas Trust continues to argue that the amendment was a move by former management of BYJU’S to dilute Glas Trust’s stake in Aakash.

Aakash has argued that the amendments in the AoA are needed for it to raise fresh funds, which is critical for its sustenance. Earlier in January, Aakash’s counsel told the NCLT that a financial crisis is imminent for it, as soon as February, if the company was not allowed to raise money either via equity or debt. 

Meanwhile, a chunk of the other investors like Manipal Education & Medical Group and Blackstone, against whom Chaudhary has also filed petition, have also supported Aakash’s bid to raise fresh capital by opposing Glas Trust’s petition. 

However, Glas Trust is now seeking the National Company Law Appellate Tribunal’s (NCLAT) intervention in the matter. 

Earlier this month, Glas Trust also moved the NCLAT seeking an interim stay on key decisions made at Aakash’s extraordinary general meeting in November 2023. However, the plea was rejected by the Appellate Tribunal.