Byju’s, an ed-tech startup, announced on Monday that it had acquired Aakash Educational Services Ltd (AESL) to strengthen its position in the country’s test preparation market. According to reports, the transaction is valued at close to USD 1 billion (roughly Rs 7,300 crore), making it Byju’s largest acquisition to date.
The firms, on the other hand, declined to comment on the deal’s financial details. Aakash founders and Blackstone would become Byju’s shareholders as part of the deal. Mary Meeker, Yuri Milner, Chan-Zuckerberg Initiative, Tencent, Sequoia Capital, Tiger Global, and others have backed Byju’s, which is the most valuable ed-tech startup in the world. To date, it is reported that it has raised over USD 2 billion in funding.
“This will be India’s largest education integration, especially in the startup room… COVID has greatly opened the doors to online education, and we believe that in the future, all kinds of educational models will exist in K-12, test prep, and even higher education,” AESL Managing Director Aakash Chaudhry told PTI.
AESL will be able to provide students with the same education it currently provides, but on a much larger scale, with multiple distribution platforms that can be innovated from both ecosystems (online and offline), he added. Byju’s will make additional investments to boost Aakash’s growth after the integration, he said. AESL will continue to function as a separate company, according to Chaudhry, and will expand its presence in the region.
“Aakash is focused on transforming student experiences through creative and digitally powered learning solutions. We will partner with BYJU’S to create an omnichannel learning offering that will take the test-prep experience to the next level,” he said.
AESL has helped millions of students prepare for medical and engineering entrance exams for its 33-year history. It has a pan-India network of 215 centers (including franchisees) and over 2.5 lakh students. Private equity firm Blackstone acquired a 37.5 percent interest in AESL in 2019. Sources said the Rs 1,350 crore transaction valued AESL at USD 500 million, though the company had not disclosed the financial details (over Rs 3,545 crore).
“We will be able to develop skills and create engaging and personalized learning programs thanks to our complementary strengths. The future of learning is hybrid, and this collaboration will put together the best of both offline and online learning as we pool our resources to create unforgettable experiences for students,” says the business. Byju Raveendran, the company’s founder, and CEO said.
Byju’s said the organization would search for investments that bring in new technologies and formats, market growth, and/or distribution opportunities when asked if the ed-tech platform would continue to scout for acquisitions. Byju’s has over 80 million students learning from the app, 5.5 million annual paying subscriptions, and an annual renewal rate of 86% since its launch in 2015. Byju’s added 45 million new students to its network between April and September 2020.