Abu Dhabi’s sovereign wealth funds in talks for BYJU’S $500 million fundraising

Abu Dhabi’s sovereign wealth funds are in active negotiations with its parent company Think and Learn Pvt Ltd. On the other hand, Qatar Investment Authority (QIA) is yet to take a final decision on its investment, Economic Times reported. The report also added that QIA had been in advanced talks for an investment of $250-350 million in the Byju Raveendran-led company with a plan to invest at a 40-50% discount to $20 billion valuation.

The edtech company is providing options to potential investors. One is to come as equity investors at a $22 billion valuation or opt for a convertible pre-initial public offering instrument with a 20% discount to an IPO valuation band.

It may even explore the option of bringing together an investor consortium. For the same, it is in talks with the royalty at UAE.

“They are keen on India and the edtech story. ADQ is also an existing investor, so there is comfort. It’s not yet clear which Abu Dhabi investment vehicle will come in. It’s possible this round will be led by International Holding Company (IHC),” a person close to the development said, as quoted in the report.

It is pertinent to note that the highest valued edtech company in the world is under pressure for its delayed financials. And as per reports, it has now shared a date of September 6 to finalise its financials.

Moreover, it is facing heat from different authorities. And, there were reports that the edtech company was asked to give reasons for the delay in filing the audited financial statements for FY21.

In FY20, BYJU’S posted a net profit of INR 51 Cr on a revenue base of INR 2,434 Cr.

Due to the delayed financials, QIA was divided over the investment. Some people with the company wanted to wait till the audited numbers were out. QIA also wanted to opt for an independent, third-party due diligence and forensic exercise to check the books of accounts. However, the edtech giant had been withstanding that.

It wants to utililise the fresh funds if raised for acquisition and growth. In the past, BYU’S acquired many startups including Great Learning, Toppr, US-based reading platform Epic for $500 million, US-based Tynker and Whodat, GradeUp, HashLearn and Austria-based GeoGebra, as well as test prep company Aakash.

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