Byju's is reportedly raising about $150 million from UBS Group at a valuation of about $16.5 billion (Image: Shutterstock)
Online education startup Byju’s is in talks to acquire Great Learning and Gradeup for $400 million, sources have told Entrackr.
“Byju’s is in advanced-stage talks to acquire the upskilling platform Great Learning and test-prep firm Gradeup,” Entrackr quoted one of the sources as saying.
The sources said that conversations with both the companies had reached the post term-sheet stage. A term sheet is a non-binding agreement that spells out the terms and conditions of an investment.
“Byju’s is likely to spend over $330-350 million to acquire Great Learning,” a second source was quoted as saying by Entrackr. “If nothing goes wrong from here, both deals are likely to be closed by next month.”
Great Learning is a Mohan Lakhamraju-led company based out of Gurugram. It offers programmes like data science, analytics, AI, machine- learning, cloud computing, cybersecurity and digital business.
The eight-year-old bootstrapped startup had an operating revenue of Rs 227.60 crore in FY20 with an expense of Rs 239.82 crore, whereas the losses stood at Rs 8.77 crore, regulatory filings show.
Gradeup helps students prepare for exams like GATE, UPSC, CAT, JEE, NEET, banks, SSC, Railways, etc.
Established in 2015, the startup raised $10 million in 2019 from the Times internet. In FY20, it posted net revenue of Rs 24 crore, while net loss stood at Rs 33 crore.
According to a Financial Express report, CEO Shobhit Bhatnagar recently said the company's net revenue stood at close to Rs 60 crore in FY21.
Also Read: Tax evasion: Byju’s parent faces scrutiny by GST intelligence wing
“For Gradeup, Byju’s will shell out anywhere between $40-50 million,” said the person quoted at the beginning of the story. “This acquisition would strengthen Byju’s game in the test-preparation segment against Unacademy.”
On April 5, Byju's acquired Aakash Educational Services Ltd (AESL) to bolster its presence in the test-preparation segment. The deal is worth close to $1 billion (about Rs 7,300 crore), making it the biggest acquisition by Byju's to date.
On April 11, there were reports that Byju’s had raised about $1 billion from new investors, including former Facebook
co-founder Eduardo Saverin's B Capital Group, Baron Funds and XN. The infusion that values India’s online-lessons platform at about $15 billion is among the largest recent capital increases in India.