Indian education technology giant Byju’s has 80 million students on Monday. It announced that it had acquired Aakash Educational Services, a physical education institution, through a strategic merger. The transaction will help the Bangalore-based entity bring Aakash’s exam preparation expertise to its content and technical capabilities to further consolidate its online education model in the country. It may also enable New Delhi-based Aakash to expand its online operations in the country while continuing its educational institution.
Aakash already has more than 215 centers in India, which can help students prepare for medical and engineering entrance exams. In addition to entrance exams, this chain store with decades of history has more than 33 years of teaching experience, which can test schools and board of directors, National Talent Search Examination (NTSE) and Olympic competitions, and Kishore Vaigyanik Protsahan Yojana (KVPY) procedures.
Byju’s is unlikely to change Aakash’s existing core business through acquisition. However, it pointed out in a press statement that it plans to make further investments to accelerate the growth of the chain of traditional educational institutions. The transaction will also help Byju’s introduce new industries, themes and languages to its online platform.
Bloomberg first reported on the transaction between Byju and Aakash in January. TechCrunch quoted people familiar with the matter and reported that although the two companies did not provide any details about the transaction, Byju’s has paid “nearly $1 billion” in cash and equity for the merger.
According to the terms of the transaction announced through the press conference, Aakash will continue to operate independently after the transaction is completed. The founders JC Chaudhry and Aakash Chaudhry will also remain in the company after the acquisition.
The coronavirus pandemic has helped Byju reach a new level, as students mostly stay indoors and take remote classes. The company said that in just six months during the national lockdown, the platform added 45 million new students. It is said that in the user base of 80 million students, there are a total of 5.5 million paid subscriptions each year, and learning through the application-an annual update rate of 86%.
The pandemic has brought the form of blended learning to the most important position. As we unite and gather decades of expertise and experience, this partnership will further accelerate the growth and success of Aakash. Said Byju Raveendran, founder and CEO of Byju’s.
With the support of American investment management company Blackstone, Aakash’s exam preparation service has won great popularity in India. This popularity may help Byju’s expand its platform. The acquisition is expected to also allow Aakash and Byju’s to enter the country’s smaller towns.
“Together with Byju, we will be committed to building an omni-channel learning product to take the test preparation experience to a new level,” said Aakash Chaudhry, managing director of Aakash Education Services.
Global professional services company EY is Byju’s exclusive financial advisor, while Phoenix Advisers is Aakash’s exclusive advisor.
Last year, Byju acquired WhiteHatJr, a code learning platform in Mumbai, for US$300 million (approximately Rs 22 billion). In June last year, the company also received an investment from Mary Meeker’s stock fund Bond, which is said to be less than 100 million U.S. dollars (about 7.3 billion rupees).
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