According to reports, the edtech decacorn BYJU’S is in discussions to raise between $400 million and $600 million with the US-based Apollo Global Management and the Abu Dhabi-based fund 10X AD.
If the deal is approved, 10X AD could invest $150–200 Mn in either the parent business Think and Learn Private Ltd. of BYJU or a subsidiary called Aakash Education Services. The edtech leader, on the other hand, has also contacted Apollo Global to request a $200–250 Mn structured finance for Aakash.
Sources claim that 10X AD is considering both alternatives, including leading an investor consortium and going it alone. In addition, the Abu Dhabi-based fund has requested guaranteed internal rates of return (IRRs), select options, and preference rights as “downside protection” in the deal.
The late-stage tech-focused fund is known to bring in other investors and organisations, like ADQ, to shore up the pool size, though it typically invests between $30 and $50 million on its own. A few more local small investment groups may potentially participate in the deal.
According to the reports, Disrupt AD, the venture capital arm of ADQ, is considering increasing its initial interest in the leading provider of edtech and may participate in the fundraising.
For its subsidiary Aakash, BYJU’S has additionally asked Apollo Global for funding. A preferred instrument with a fixed, previously agreed-upon IRR and downside protection may be used to make this $200–250 million investment, or it could occur at a discount to the following round.
It’s interesting to note that the PE company rejected BYJU’s earlier attempt to obtain funding from Apollo Global.