NEW DELHI: India's popular online-education startup- Byju's is all set to acquire brick & mortar test prep leader Aakash Educational Services Ltd. for $1 billion.
Byju's current market value is capped at $12 billion and due to the present pandemic situation globally, the online startup is aggressively looking at expanding as the demand of online classes has gone up since 2020.
According to Bloomberg, the deal which is said to be sealed in two or three months time will be one of the largest edtech acquisitions in the world.
Notably, founders of Aakash will completely exit while Blackstone will swap a portion of its 37.5% equity in Aakash for Byju's stake.
While Bangalore-based Byju's was founded by Byju Raveendran in 2011. In August 2015, after 4 years of developments, the firm launched Byju's: The Learning App. The Byju's app caters to students from kindergarten to the 12th grade.
Seeking the opportunity to tap the online education model, the e-commerce giant- Amazon.com announced about this new platform on Wednesday, as it has seen a boom or an increase in the virtual or online learning during the novel coronavirus pandemic.
The app will further provide learning materials, live lectures and assessments to help the candidates prepare for the Joint Entrance Examination (JEE).
One of the most competitive exams, JEE allows a student enters into the topmost engineering colleges of the country. The company said in a statement that the content on the platform is currently free for everyone, and will remain free for "the next few months."
A consultancy, called the RedSeer estimated that by 2022, the online education market for grades 1 to 12 should expand six-fold to $1.7 billion. The online education market for students beyond grade 12 is set to increase nearly quadruple to $1.8 billion.
Market leader BYJU's, along with other Indian Edutech companies like Unacademy and Vedantu has raised a total of $2.22 billion last year. The amount is four times the amount raised in the year 2019. The information was shared by the Indian Private Equity and Venture Capital Association and PGA Labs.
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