Edtech decacorn Byju’s has closed the deal to acquire exam preparation firm Aakash Educational Services Limited (AESL) for nearly $1 billion. The stock-and-cash deal is the biggest in the education space, said sources.
Byju’s said the deal is a strategic partnership with AESL, a leader in test-prep services.
“I am happy to have Aakash Educational Services Limited (AESL), a market leader and the most trusted name in the test-prep services, on board with us,” said Byju Raveendran, Founder, and CEO, Byju’s. “Our complementary strengths will enable us to build capabilities, create engaging and personalised learning programmes. The future of learning is hybrid and this union will bring together the best of offline and online learning, as we combine our expertise to create impactful experiences for students.”
Raveendran said the pandemic has brought the importance of the blended format of learning to the forefront. “As we unite our forces to bring together decades of expertise and experience, this partnership will further accelerate Aakash’s growth and success.”
This partnership brings together two of the largest and most-trusted education brands in India -combining Aakash’s pedagogy expertise in the test-prep segment with Byju’s content and tech capabilities. After the integration, Byju’s will make further investments to accelerate Aakash’s growth.
With over 33 years of experience, Aakash said it has built a highly effective learning ecosystem that has helped millions of young aspirants get into the country’s best institutions. In 2019, AESL partnered with private equity firm Blackstone to create India’s largest digitally enabled, omnichannel test preparation company. Under the leadership of Founder JC Chaudhry and Aakash Chaudhry, it will continue to function independently.
“At Aakash, we are looking to transform student experiences by steering innovative and digitally-enabled learning solutions. Together with Byju’s, we will work towards building an omnichannel learning offering that will accelerate test-prep experience to the next level,” said Aakash Chaudhry, managing director, AESL. “While this partnership will enhance our operational verticals, Aakash will continue to operate as a separate entity with the same passion and commitment with which it’s founder and chairman J C Chaudhry incepted it. We are excited to partner with Byju’s, and will strive to deliver long-term value to our students, employees, investors, and other stakeholders.”
The addition of Aakash is a significant step towards strengthening Byju’s product offering. It reiterates Byju’s focus on creating impactful learning products for students by adding more verticals, subjects, and languages to the same platform.
Amit Dixit, co-head of Asia Acquisitions and head of India Private Equity at Blackstone, said that the company invested in AESL as it is one of the leading education brands in India with a professional management team, best-in-class corporate governance and a 33-year track-record of exceptional results.
“We have always believed omnichannel will be the winning model in test prep and tutoring, and we look forward to being a part of the partnership between the two foremost companies in Indian supplementary education – Aakash and Byju’s,” said Dixit. “The combination of Aakash and Byju’s is highly synergistic and we are excited to help build India’s largest education company.”
EY was the exclusive financial advisor for Byju’s on this transaction. Phoenix Advisors was the exclusive advisor for the AESL.
With over 215 centres, Aakash provides test preparatory services to students preparing for medical and engineering entrance exams, school/board exams, KVPY, NTSE, Olympiads, and other Foundation level exams. Known for its integrated teaching methodology and focused learning environment.
Launched in 2015, Byju’s is the leader in offering personalised learning programs for school students in India. With over 80 million students cumulatively learning from the app, 5.5 million annual paid subscriptions, and an annual renewal rate of 86 per cent, the app creates personalized learning programs for individual students based on their proficiency levels and capabilities which help them learn at their own pace and style. In just 6 months during the lockdown, Byju’s has added 45 million new students to its platform.