According to media reports, Ranjan Pai, chairman of Manipal Education and Medical Group, plans to invest a larger amount of money in Byju’s test prep subsidiary, Aakash Institute. He is considering investing USD 250 to USD 300 million, which is significantly more than his initial plan of USD 70 million. This investment will help Byju’s clear its outstanding debt to Davidson Kempner’s (DK). The total investment amount may increase further once the details are finalised.
A couple of months back, on 12 May, Byju’s had signed a Rs 2,000 crore structured credit deal with DK against the cash flows of Aakash, which later ran into trouble in June. Both entities are now in talks to settle their disputes.
About USD 100 million of the recent investment will be used to pay off the debt from DK, while the remaining amount is the interest, as per reports.
The chairman of the Manipal group plans to acquire a larger share in Aakash, despite the ongoing dispute between the Chaudhrys and Byju’s parent company, Think and Learn. He may also bring in other private equity firms, including some well-known ones.
Pai recently invested in a baby products online store called FirstCry and a jewelry maker called Bluestone, which has both physical stores and an online presence.
Aakash, is expected to remain a subsidiary of Think and Learn, which owns at least 51 per cent of the offline coaching company. Byju Raveendran, the founder and CEO of Byju’s, holds around 30 per cent stake in Aakash which may decrease. Think and Learn, the parent company of Byju’s, holds a 40 per cent stake. Other major shareholders in Aakash include private equity firm Blackstone with a 12 per cent stake and the Chaudhry family with an 18 per cent stake.
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