Byju’s in talks to buy US-listed edtech firm

Edtech unicorn Byju’s is rumored to be in talks to buy US-listed edtech firm Chegg, The Economic Times reported.

Byju’s founder and CEO Byju Raveendran / Photo credit: Byju’s

In an interview with The Economic Times, Byju’s founder Byju Raveendran said his company was looking at multi-billion dollar acquisitions and exploring firms in the US, which is why the edtech firm was raising capital. 

The Byju’s founder said the next twelve months will be the best time to acquire companies, but he did not confirm plans to acquire Chegg. 

The California-based online tutoring company was founded by Osman Rashid and Aayush Phumbhra in 2005. Chegg has a current market capitalization of US$2.2 billion.

Sources said Byju’s was in talks to acquire Chegg, and if successful, this could aid the startup in going public. However, Raveendran told The Economic Times that the potential acquisition “is not the route to go public in the US.”

He added that should Byju’s go ahead with an IPO, likely in the next nine to 12 months, it would be through a special purpose acquisition company.

Byju’s was previously in talks with at least three SPACs to go public via a merger. It opted for a SPAC merger instead of a traditional public listing as the company sees value in having US-based investors and strategic partners.

It was also in talks with banks to raise over US$1 billion to expand its operations and use the funds to acquire an undisclosed edtech company.

Recently, the edtech firm spent US$100 million for Singapore-based edtech firm Northwest Executive education.

Byju’s has a valuation of US$22 billion after it raised US$800 million in a funding round in March. Raveendran invested half the amount to raise his stake in the company. Sumeru Venture, Vitruvian Partners, and BlackRock also joined the round.

Also read: Indian edtech yet to open up to tech for the disabled.