Edtech giant BYJU’S is raising $1 billion in funding through a mix of equity and structured instruments at its current valuation of $22 billion. Structured investments are market-linked investment products based on securities. They can be later converted into shares at the time of events like an initial public offering. BT had reported earlier that the edtech firm is raising $700 million in a fresh funding round which involves two separate deals of equity and convertible notes. “The company is in the middle of closing the deal. The due diligence process is complete,” a source told BT and also revealed, “They are waiting for the money to get credited into their bank account. They want to close the deal completely before making the announcement.”
According to the report by Moneycontrol, $700 million of the $1 billion will be raised through equity and one of the three Middle East-based sovereign funds is in talks to lead the round, sources revealed. The report also stated that the remaining $300 million will be raised via structured instruments and the company is in advanced talks with US-based asset management companies Oaktree Capital Management, Apollo Management, and Davidson Kempner Capital Management, the people said, requesting anonymity. The funding round is expected to close in a month's time and it will also help the company pay a part of the $1.2 billion it had raised in 2021. In February, Bloomberg also stated that the company is in separate talks with creditors to renegotiate an agreement governing the term loan that’s in breach of covenants. The Bloomberg report noted that BYJU’S is in talks with investors such as Texas Pacific Group Capital (TPG) to raise more than $500 million. It also said that the capital infusion is "much needed" as it could help them "stave off potential debt issues." Business Today reached out to the company for a comment but failed to get a response. In an interview with BT, the edtech major’s co-founder Divya Gokulnath, said that the company is focused on scaling its offline model -- the tuition centres -- and for that they need investment. Additionally, the company is focusing on its K-12 models as well, she told BT.
Also Read: Stride Ventures makes first close of its third venture debt fund at $100 mn