Ranjan Pai to bring ₹250 crore more into Aakash as Manipal bids for Byju's
The fresh infusion in Aakash from the family office of the founder of Manipal Group follows a months-long legal tussle over Aakash’s plan to raise capital via a rights issue.
Ranjan Pai’s family office, the largest shareholder in Aakash Educational Services Ltd (AESL), plans to invest about ₹250 crore in the ongoing ₹450-500 crore rights offer in tranches, depending on the response of other shareholders and the achievement of certain targets set for the company, three people familiar with the matter said.
The first tranche of about ₹100 crore has been approved and is expected to be disbursed shortly, while the remainder could follow in about three months, subject to certain performance metrics and the participation of other existing investors, the three people said.
Separately, Pai's Manipal Education and Medical Group on Thursday submitted a bid to acquire Byju's, its second such attempt to acquire the bankrupt edtech through an insolvency process. If that bid succeeds, Pai's business will own an additional 25% stake in Aakash, apart from current 58% stake. A Manipal Group statement said that a successful resolution with Think & Learn will “help in business consolidation of Aakash, in which Manipal has a majority shareholding."
The fresh infusion in Aakash from the family office of the founder of Manipal Group follows a months-long legal tussle over Aakash’s plan to raise capital via a rights issue. The fundraising effort was challenged by edtech firm Byju’s, which acquired Aakash in a cash-and-stock deal valued at about $950 million in April 2021, and one of its creditors.
“Pai’s office will infuse its portion of the rights issue… around ₹250 crore is the total… and ₹100 crore is the first tranche. The second tranche will be released depending on whether investors come in," said one person aware of the funding plans.
The person added that subscribing to the rights issue will lift Pai’s stake in the company. His family office acquired a 39.6% stake after converting a $300 million debt investment into equity in early 2024. In June this year, Pai won the competition regulator’s approval to acquire founder J.C. Chaudhry’s 11% stake.
Pai currently holds a 58% stake in Aakash, according to the second person.
The other major shareholders in Aakash are said to include Byju's (Think & Learn Pvt Ltd) with about 26% and Blackstone with a reported 7-8%.
The rights issue could dilute Byju’s stake, according to recent reports, which suggested that it may not be able to participate due to its insolvency proceedings. It was not immediately clear if Aakash’s other existing investors would subscribe to the rights issue.
Larger funding round
Pai and the management plan to float a larger funding round sometime between early and mid-2026 and may look at tapping private equity investors, two of the people said.
“However, the larger round next year will be contingent on business metrics improving as the company is currently focused on strengthening its financials," said the first person cited earlier.
Calls, emails and text messages sent to Aakash’s spokesperson did not elicit a response until press time.
The infusion of fresh funds into Aakash comes as the engineering and medical college entrance examination preparation company deals with a leadership churn and uncertainty linked to Byju’s insolvency proceedings.
The rights issue plan had been challenged by Byju’s parent company Think & Learn and its US-based lender GLAS Trust Company. The petitioners failed to secure interim relief at the National Company Law Appellate Tribunal in late October.
The Supreme Court declined to admit civil appeals against the tribunal’s decisions, effectively allowing Aakash to proceed with the shareholder-approved rights issue and related capital-raising steps, according to recent court reports.
Even as Aakash gets fresh funding, its C-suite has been in a flux. Chief financial officer Vipan Joshi exited the company on 31 October, about two months after the resignation of chief executive officer Deepak Mehrotra in August, underscoring a period of rapid leadership change at the test-prep major.
Mehrotra was succeeded by Chandra Sekhar Reddy Garisa as managing director and CEO with effect from 19 August. Garisa most recently led Claypond Capital, Pai’s family office.
Company financials
Aakash has not filed its financials for FY24 and FY25. It reported a net loss of ₹79.4 crore in FY23 compared with a net profit of ₹79.5 crore in FY22. Revenue from operations rose 68% to ₹2,385.8 crore in FY23, according to a regulatory filing with the Registrar of Companies accessed by Mint.
Aakash competes with Allen, FIITJEE, Bansal Classes and Unacademy, among others. In interviews in January, then CEO Mehrotra said the company was looking to raise about ₹500 crore. He told PTI in October 2024 that Aakash planned to invest about ₹100 crore over two years to rebuild and scale Aakash Digital, its online learning arm and digital platform.
The Economic Times reported last week that Pai’s Manipal Education and Medical Group has submitted an expression of interest in Byju’s insolvency process to acquire the assets of Think & Learn, with a specific interest in its roughly 25% holding in Aakash.
Adding to the churn in the sector, Unacademy is reportedly in talks with upGrad for a potential buyout valued in the $300-400 million range. If concluded, it would mark a significant consolidation move in India’s edtech sector.
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