Home / News / India /  Amid reports of layoffs and payment delays, Byju's shopping for Nasdaq-listed firm 2U?
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Bengaluru-based largest ed-tech company, Byju's, is in news for two very different reasons in two different countries. India's $22 billion firm is making headlines in India for joining the layoff bandwagon by announcing the termination of 500 employees in WhiteHat Jr, 1,100 in Toppr and reports suggest the number may be as high as 2500 across its group of companies. Whereas in the US, speculation is high that the firm is shopping for a Nasdaq-listed ed-tech company, 2U, for an approximately $15/share in a cash deal, valuing the firm at $1 billion.

According to a Bloomberg report, Byju’s has made a $15 a share offer to 2U’s board last week, representing a 61% premium to 2U’s closing price of $9.30 on the Nasdaq on Tuesday. It gives the Lanham, Maryland-based company an enterprise value of about $2 billion. 2U currently has a market value of $717 million with an approximate $1 billion in debt and other liabilities. Its shares have popped 17% on Wednesday in response to the news.

Though it's not just 2U, reports also suggest Byju's founder Byju Raveendran is also eyeing California-based Chegg with a market value of $2.3 billion. The talks have been on for months now, but there has been no concrete way forward. The company is looking to ramp up its growth and global expansion and has secured financing of over $2.4 billion for whichever deal it finally pursues. While debt financing is more expensive than just three months ago, assets are cheaper and deals are still looking attractive, the person said.

Meanwhile, back in India Byju's is on a cost-cutting spree, it has laid off 500 employees at its subsidiary WhiteHat Jr and 1,100 in Toppr. According to a report in MoneyControl, “While on June 27 and June 28, Byju's laid off over 1,500 employees from Toppr and WhiteHat Jr, on June 29, it sent out e-mails to nearly 1,000 employees from its core operations teams."

A company spokesperson quoted in an NDTV report said, "We strongly deny the misinformation presented by Moneycontrol. To recalibrate our business priorities and accelerate our long-term growth, we are optimizing our teams across our group companies. This entire exercise involves less than 500 employees from across Byju's group companies," 

However, Byju’s, according to a Bloomberg report, is also pushing back payments for an approximately $1 billion acquisition of test-preparation provider Aakash Educational Services struck last year. Denying any cash shortage, Byju’s wants to delay the payments until August claiming regulators have yet to clear the acquisition, according to the report.

Byju’s is India’s most valuable startup, with a valuation of $22 billion, according to the market researcher CB Insights. The edtech pioneer, formally known as Think & Learn Pvt, has about 115 million students using its online learning platform, with 7 million of them paying annual subscriptions. Its backers also include Silver Lake Management, Naspers Ltd., and Mary Meeker’s Bond Capital.

(With agency inputs)

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