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Prosus, a key investor in BYJU’S, on Tuesday, said the edtech firm experienced substantial growth since securing an initial investment from the global investment group in 2018. However, over time, the Bengaluru-based firm’s reporting and governance structures did not adequately evolve sufficiently for a company of that scale.

The Netherlands-based investment company also noted that despite repeated efforts from its Director, executive leadership at BYJU’S regularly disregarded advice and recommendations relating to strategic, operational, legal, and corporate governance matters.

“The decision for our Director to step down from the BYJU’S Board was taken after it became clear that he was unable to fulfil his fiduciary duty to serve the long-term interests of the company and its stakeholders,” Prosus stated.

Prosus, the leading institutional shareholder in BYJU’S, released a statement one month after its representative, Russell Dreisenstock, officially resigned from the board of the edtech firm. Alongside Dreisenstock, two other board members also stepped down, including GV Ravishankar, Managing Director at Peak XV Partners (formerly Sequoia Capital India); and Vivian Wu from the Chan Zuckerberg Initiative.

Recently, the edtech giant appointed Mohandas Pai, former CFO and Board Member of Infosys; and Rajnish Kumar, former Chairperson of State Bank of India; to its advisory council. It said the council will provide advice and mentorship to CEO and Co-founder Byju Raveendran, and BYJU’S board, on critical matters that shape the company’s future.

The Netherlands-based investment company’s statement further said, “BYJU’S sits at the intersection of India and education, two very important and strategic areas of investment for Prosus. Although we no longer have a representative serving on the Board of the Company, we continue to believe in the potential of BYJU’S and its role in revolutionising access to quality education in India and around the world.  

“As a shareholder, Prosus will continue to assert its rights, collaborating with other shareholders and government authorities to safeguard the long-term interests of the company and its stakeholders,” the statement added.

This statement from the investment company comes a day after it was reported that BYJU’S has reached a tentative agreement to renegotiate its loan pact with lenders who collectively own more than 85% of its $1.2-billion term loan B (TLB).

Besides the creditor conflict, BYJU’S is grappling with other issues, such as delays in filing financial statements and facing an inspection of its account books following a government order.

Meanwhile, the firm has implemented job cuts as part of its ongoing cost-cutting measures that have been in effect since last year. A few weeks ago, it initiated another round of job cuts that would impact more than 1,000 people.