Byju’s term loan target tied to $ 1.2 billion IPO

BENGALURU : Byju’s, India’s Most Valuable Startup, Raises $ 1.2 Billion in B-Term Loan Funding as the Company Prepares to Go Public in the Coming Months, Two Confirmed people familiar with the discussion.

The decision was approved by the board of directors of Think & Learn Pvt. Ltd., the parent entity that owns the Byju’s brand, said one of the people cited above. The two spoke on condition of anonymity.

mint first reported on Oct. 26, citing sources, that major edtech was seeking to raise a minimum of $ 500 million through B-Term Loans (TLBs) in the United States.

Byju’s was to use the funds primarily to fuel its acquisitions, as well as to deploy part of the increase to the company’s working capital. TLBs generally have a variable interest rate, with terms of 5 to 7 years.

A spokesperson for Byju declined to comment on the development.

The term loan comes as the company prepares to debut on the public market over the next 12 months and is actively deliberating in both the United States and India for its potential listing.

Byju’s stepped up its acquisition strategy this year with the aim of entering new edtech categories of skill enhancement, test preparation and higher education, while strengthening its presence in major international geographies, including including the United States.

This year alone, Byju’s made nine acquisitions and spent nearly $ 2.5 billion to acquire various edtech companies. In April of this year, it spent nearly $ 950 million to acquire the educational institution Aakash Educational Services Ltd (AESL), in what is billed as one of the most expensive acquisitions in the edtech space. Indian. The edtech company also spent nearly $ 600 million to acquire Great Learning, marking its entry into the learning space.

“The historic success of Byju TLB, as the largest unrated TLB in India and Asia as well as one of the world’s largest unrated TLBs in history, reflects the strong credit history of the company as one of the largest and fastest growing global edtech platform with full product line for multiple age groups, many strong brands, differentiated immersive content for kids to fall in love with ‘learning,’ said Kamal Yadav, managing director of Morgan Stanley.

American investment banks, including Morgan Stanley and JP Morgan, worked with Byju’s to structure the TLB.

Bloomberg first reported Byju’s increase in his target size for the TLB on Monday afternoon. He also added that the company was in talks with Blackstone, Fidelity and GIC for the term loan.

Byju’s is not the first Indian startup to raise funds through a TLB channel. Earlier in July of this year, the hotel unicorn, Oyo Hotels and Homes Ltd. raised $ 660 million in debt financing from global institutional investors, including Fidelity Investments. According to Oyo, the proposed issue was subscribed 1.7 times as it received pledges of nearly $ 1 billion from leading institutional investors.

Byju’s currently has over 100 million enrolled students and 6.5 million paying subscribers. He is in talks with investors to raise an additional $ 1.5 billion, which could potentially value the edtech company at $ 21 billion, mint reported in August. As part of the round, Byju recently raised $ 300 million in October, which valued the Indian edtech company at around $ 18 billion.

Think and Learn Pvt. Ltd, which operates Byju’s, reported a jump in its total revenue to ??2,380 crore in the year ended March 2020 from ??1,305 crore the previous year. However, the losses extended to ??262 crores ??8.82 crore the previous year.

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