BackByju's mulls partial sale of Aakash Education stake; renew talks with lenders to restructure debt load: Reports
Edtech company BYJU'S is considering selling part of its stake in Aakash Educational Services, while also renegotiating its $1.2 billion term loan. The company acquired Aakash Education for $950 million in 2021 and had earlier planned to list it through an IPO by mid-2024.
PremiumBeleaguered edtech company BYJU'S is now looking to sell part of its state in Aakash Educational Services. The report came alongside indications that the startup and some of its lenders have restarted negotiations to restructure the firm's $1.2 billion term loan. BYJU'S has repeatedly made headlines over the past month due to a slew of issues - from layoffs and the exit of three board members and its auditor to delays in remitting provident funds, ED raid sand more. Recently, Dutch-listed technology investor Prosus NV had also slashed its valuation to $5.1 billion.
According to an update shared by ET Now, Byju's holding company, Think and Learn, is looking to dilute up to 20% of its total 70% equity stake in Aakash Education. There has been no official confirmation with sources telling the channel that talks with prospective investors were currently in a preliminary stage.
Having bought Aakash Education for $950 million in 2021, the company had earlier indicated plans to list it through an IPO by mid-2024.
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Meanwhile a Bloomberg report quoting sources indicated that the company had restarted negotiations with its lenders to avoid escalation of a legal brawl. The lenders have reportedly delivered a detailed amendment proposal to the company that calls for a debt pay down, coupon boost and better investor protections on the loan. A reply is likely to be delivered early next week.
Byju’s and its lenders have been mired in a conflict for several months following rounds of failed negotiations to revamp its loan agreement. The company elected to miss an interest payment on its term loan in June, exacerbating a conflict with lenders that underpins it mounting distress.
The Indian firm is in advanced talks with prospective new shareholders for a $1 billion fundraising round.
(With inputs from agencies)
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