BYJU’S Explores Partial Stake Sale in Aakash Education Services as IPO Plans Take Shape
- ByStartupStory | July 1, 2023
Edtech leader BYJU’S is reportedly in talks with potential investors to divest a portion of its stake in its subsidiary, Aakash Education Services Limited. According to sources cited by television news channel ET Now, BYJU’S holding company, Think & Learn Pvt Ltd, is considering reducing its stake in Aakash by up to 20% from its current 70% share. However, the discussions with potential investors are still in the early and preliminary stages, the report added. BYJU’S declined to comment on the matter.
This news of a potential stake sale comes on the heels of BYJU’S revealing its plans to launch the initial public offering (IPO) of Aakash by mid-2024. In 2021, the Bengaluru-based edtech company acquired the brick-and-mortar education player Aakash for approximately $1 billion. Since the acquisition, Aakash’s growth has experienced a significant boost, with revenue tripling in just the past two years, as stated by BYJU’S.
Among BYJU’S numerous acquisitions, Aakash has emerged as one of the most successful. The move to explore a partial stake sale is seen as part of BYJU’S broader strategy to optimize its holdings and pave the way for the anticipated IPO of Aakash. The stake sale would allow BYJU’S to attract external investors who could contribute to the further expansion and development of Aakash.
However, BYJU’S currently faces various challenges, including the recent departure of Deloitte as its auditor, the resignation of three prominent board members, conflicts with creditors concerning a $1.2-billion Term Loan B (TLB), and delays in filing financial statements, among other issues. These hurdles have led to increased scrutiny and raised concerns among industry experts and stakeholders.
Despite the challenges, BYJU’S remains a dominant force in the edtech sector, with a wide range of educational offerings and a strong presence in the Indian market. The potential stake sale in Aakash, along with the planned IPO, indicates BYJU’S commitment to strategic growth and its efforts to optimize its business operations.
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