Byju’s advanced talks to go public through SPAC deal: Report

The startup is in talks with a number of potential SPAC partners and is far from working on a deal with Michael Klein’s Churchill Capital, the people said, asking not to discuss private matters. Churchill Capital VII raised more than $1.3 billion in an offering in February and traded on the New York Stock Exchange.

Under the initial terms discussed, Byju’s will raise a total of about $4 billion and have a valuation of about $48 billion, the people said. According to market research firm CB Insights, the startup was valued at $21 billion.

While an announcement could come as soon as January, talks are not final. People said that Byju’s or Churchill may still be out of such a deal, and Byju’s may consider an IPO in India next year. Byju declined to comment. Churchill did not immediately respond to requests for comment.

The Bangalore-headquartered company, founded and led by former teacher Byju Raveendran, provides K-12 lessons and video content to millions of Indians studying for the country’s competitive engineering and medical entrance exams. It also provides one-to-one coding, math and reading classes and materials to students in countries in North America, the Middle East, and Latin America.

Bloomberg News reported in September that Byju’s was aiming to file preliminary documents for a traditional initial public offering in the second quarter of 2022, and that SPAC was also considering a merger. This was a spurt on earlier plans to go public in 12 to 24 months. The startup and its bankers had discussed a valuation of $40 billion to $50 billion, though the final determination would depend on financial results and investor demand, people familiar with the matter said at the time.

India’s technology sector has grown this year, with IPO fundraising on track to reach record levels. Venture capital firms have also increased their investments in the country, fueled by Communist Party actions in China, which have made that market less hospitable.

Digital payments pioneer Paytm went public in the country’s biggest IPO ever, but its shares fell sharply. It’s not clear how that episode has affected investors’ appetite for larger offerings.

Byju’s, formally called Think and Learn Pvt, has major global investors including Facebook founder Mark Zuckerberg’s Chan-Zuckerberg initiative, Naspers Ltd., Tiger Global Management and private equity giant Silver Lake Management.

In a recent conversation with Bloomberg News, founder Raveendran said that the startup is targeting revenue of 100 billion rupees ($1.3 billion) with a 20% margin in the year ending March 2022. Byju’s has been on acquisitions over the past year, acquiring startups that offer coding lessons, professional learning courses and test preparation classes for competitive Indian exams.

This story has been published without modification in text from a wire agency feed. Only the title has been changed.