Byju’s, the Indian edutech behemoth with a userbase of over 80 million students, revealed on Monday, that it had concluded a strategic merger with brick-and-mortar educational institution chain Aakash Educational Services. The deal would allow the Bengaluru-based business to incorporate Aakash’s test-prep experience to its content and technology capabilities, enabling it to further improve its online education model in India. It will also enable Aakash, based in New Delhi, to extend its online presence in the country, while maintaining its educational institutes.
Aakash has over 215 centres in India, that help students study for medical and engineering entrance exams. In addition to entrance tests, the decades-old chain, which has over 33 years of experience educating students, provides test preparation for school and board exams, the National Talent Search Exam (NTSE), Olympiads, and the Kishore Vaigyanik Protsahan Yojana (KVPY).
Byju’s takeover is unlikely to shift Aakash’s current core market. However, it confirmed in a press release that it expects to make additional investments, in order to speed up the development of the conventional educational institution chain. Byju’s will be able to broaden its website by introducing additional verticals, topics, and languages, as a result of the agreement.
Bloomberg broke the story about Byju’s and Aakash’s partnership in January. According to TechCrunch, which cited people familiar with the matter, Byju’s paid “up to $1 billion” in cash and equity for the merger, despite neither company providing much information.
According to the terms of the contract, Aakash will continue to run independently after the agreement is concluded, as described in the press release. JC Chaudhry and Aakash Chaudhry, the firm’s founders, will remain on, after the takeover.
Since students are mainly remaining indoors and taking remote classes due to the coronavirus pandemic, Byju’s has grown to new heights. During the nationwide lockdown, the organisation said it attracted 45 million new students to the site in just six months. It claims to have over 5.5 million monthly paying subscribers, with an annual renewal rate of 86 percent, out of a userbase of 80 million students learning from its app.
The pandemic has taken the value of a mixed learning approach to the fore. ‘’This relationship will further boost Aakash’s growth and development as we combine our forces to put together decades of talent and experience, said Byju Raveendran, Founder and CEO of Byju’s.
Aakash has grown in prominence in India, thanks to its test preparation services, which are backed by the US-based investment equity company Blackstone. Byju’s could be able to broaden its platform as a result of its success. Both, Aakash and Byju’s are expected to benefit from the acquisition, as it will enable them to branch out to smaller towns and cities across the world.
‘’We will work along with Byju’s to create an omni-channel learning offering that will take the test-prep experience to the next level, said Aakash Chaudhry, Managing Director of Aakash Educational Services.
An international professional services company, Byju’s was advised by EY exclusively on the deal, while Aakash was advised by Phoenix Advisers exclusively.
