BYJU’S in talks to raise $500 mn from TPG: Report

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Edtech company BYJU’S is in talks with investors such as Texas Pacific Group Capital (TPG) to raise over $500 million, according to a Bloomberg report. The report revealed that there is a great need for capital infusion as it can help them overcome potential debt issues.

Bloomberg also reported that the Byju Raveendran-led firm, which is valued at around $22 billion, is trying to keep its valuation stable. Additionally, TPG and two Middle Eastern sovereign wealth funds have initiated due diligence on the company amid funding talks.

People familiar with the matter have said talks are ongoing and it is unclear whether potential investors will pursue the deal. The report also said the company is in separate talks with creditors to renegotiate an agreement governing $1.2 billion in debt that is in breach of covenants.

2022 has been a tough year for the edtech company. From delayed results to the recent allegations made by the National Commission for Protection of Child Rights, India’s most valuable start-up found itself in the midst of several controversies last year.

Furthermore, BYJU’S parent, Think & Learn Pvt. Ltd, widened its consolidated losses nearly 20-fold to Rs 4,588.75 crore in FY21 from Rs 231.69 crore in FY20. Revenue from operations increased marginally to Rs 2,280.26 crore in FY11 from Rs 2,189 crore in FY10. The company attributed the slower growth to a change in the way it recognizes revenue, according to advice from its audit firm Deloitte Haskins & Sells.

In an interview with Business Today, Raveendran had said, “The last six months were challenging but the next six years are going to be great.” He also revealed that the company has made a “shift from mere growth to sustainable growth”.

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