Edtech firm BYJU’S is considering selling two of its assets, Epic and Great Learning, in a bid to generate at least $800 million. This move is part of the company’s strategy to repay the debt associated with a $1.2 billion term loan B (TLB) owed to its lenders, according to sources familiar with the matter.
BYJU’S, led by Byju Raveendran, is estimating that the sale of Epic, a US-based startup specializing in a digital reading platform for children aged 12 and under, could bring in between $400-550 million, while Great Learning, a skilling startup, is expected to fetch around $350-425 million. In 2021, BYJU acquired Epic for $500 million and Great Learning for $600 million.
The company is also engaged in discussions to secure equity investments from sovereign funds in the Middle East, as part of its ongoing fundraising efforts. These discussions are actively ongoing, with another meeting scheduled in Abu Dhabi to bolster investor confidence.
The combination of equity investments and the monetization of assets could enable BYJU to pay off its TLB debt and potentially have funds left over. However, the company declined to comment on these developments.
Furthermore, BYJU has proposed an accelerated repayment plan to its lenders, offering to fully repay the $1.2 billion TLB within just six months, a significant change from the originally planned three to four-year timeline. This comes after months of negotiations and conflicts between BYJU and its lenders.
The edtech industry, despite experiencing a boom during the pandemic, has posed challenges for BYJU’S. These challenges include delays in financial statement filings, disputes with lenders over the TLB, and conflicts with US-based investment fund Davidson Kempner regarding its test prep unit, Aakash.
BYJU is expected to complete its FY22 audit by the end of September, and it is anticipated that after announcing its financial results, the company will gain more momentum and confidence for its equity fundraising efforts.
In recent weeks, BYJU’S has witnessed several high-level departures, and its subsidiary, Aakash Educational Services, has established an executive council responsible for identifying and appointing new CEOs and CFOs.
