Byju’s misses deadline to clear dues above ₹1,500 cr to Blackstone over Aakash deal
2 min read . Updated: 23 Sep 2022, 10:49 PM IST
Premium- Byju’s had announced the acquisition in April 2021 in a cash & stock deal, and had made partial payments
MUMBAI : Edtech startup Byju’s has yet again missed the deadline to clear the dues of over ₹1,500 crore, as part of the $950-million Aakash Educational Services deal, to private equity firm Blackstone Inc., said two people in the know.
Byju’s announced the purchase of test preparation startup Aakash in April 2021 in a cash and stock deal and made partial payments to its shareholders. Blackstone was paid a part of the $400 million as part of the interim arrangement, and Byju’s promised to settle the dues of ₹1,500-1,620 crore in June, said one of the two people. Subsequently, on 14 September’s audited financial statement for FY21, Byju’s said all dues to Blackstone would be settled by 23 September.
However, the balance payment has not been transferred by Friday, the two people cited above said, seeking anonymity. “The amount pending has to be paid within the next 10 days," said the first person.
“It should happen soon," the second person added. When contacted Byju’s and Blackstone declined to comment.
While the test prep startup’s founder Aakash Choudhary was paid in July, the deal could not be closed as the dues of Blackstone have not been cleared. On 14 September, co-founder Byju’s Raveendran said that the payment was stuck because of the Reserve Bank of India’s pricing guidelines, according to which an Indian entity cannot pay an overseas investor more than an entity’s fair market value. He also said that the payment of the final tranche to Blackstone will price Byju’s stake higher than its fair market value and will violate RBI’s guidelines. The final payment was due on 23 June and was deferred to September, it said in its financial statement.
A separate merger filing of Aakash Educational Services and Byju’s parent Think and Learn Pvt. Ltd is pending with the National Company Law Tribunal.
Blackstone will also receive additional shares amounting to 0.75-1% in Byju’s after the merger process is approved by the NCLT, as reported by Mint on 6 July. Blackstone’s Strategic Opportunities Fund owns an unspecified stake in Byju’s, having invested in the company separately in June 2021 as part of a nearly $340-million funding round.
Byju’s loss widened sharply to ₹4,588.75 crore for 2020-21 from ₹231.69 crore in the previous fiscal year, following a change in its revenue recognition methodology.
Byju’s was last valued by its shareholders in June 2022 at about $22.6 billion. It has so far raised nearly $6 billion from over 70 investors, including the likes of General Atlantic, Sequoia Capital, Sofina and Canada Pension Plan Investment Board.
