Byju’s is acquiring tutorial chain Aakash Educational Services Ltd in a cash and stock deal estimated at $950 million, sealing its largest buyout. India’s mostvalued edtech startup snagged coding tutor WhiteHatJr in a $300-million deal amid the pandemic last year.
Byju’s buyout of AESL is also among the largest acquisitions by an Indian startup — bigger than Snapdeal’s purchase of Freecharge for $400 million in 2015 and Flipkart’s acquisition of Myntra for an estimated $330 million in 2014.
The startup’s founder, Byju Raveendran said that Aakash Educational Services’s founders and its primary backer, the Blackstone Group, will both hold a minority stake in Byju’s.
“We will integrate Aakash’s expertise in test prep with our content and tech capabilities and will invest further capital in Aakash once the integration is done,” said Raveendran.
Last week, the Bengaluru-based company raised $460 million in a series F round of primary capital at a valuation of $13 billion. MC Global Edtech Investments Holdings, which led the round, brought in around $222 million, while Facebook cofounder Eduardo Saverin’s startup fund, B Capital, invested around $75 million through its Asian and global entities.
Other investors who participated include TIGA, TCDS India, Arison Holdings, XN Exponent Holdings, Baron Emerging Markets Fund and Global Advantage Fund.
“We will continue to expand the offline footprint and Aakash will be at the front end of all our test prep initiatives,” Raveendran said.
Byju’s is also finalising the acquisition of Toppr, an online learning firm, for $150 million, which it may finance through internal cash reserves.
“Other acquisitions are smaller in size and we have cash in hand. We will see how the final deal contours work out,” Raveendran said.
“This acquisition will help Byju’s cross the $1 billion mark in revenues for the next financial year. We are looking at closing the next year at $1.2-1.3 billion in revenues,” he said.