SUMMARY
Besides 2U, BYJU’S is also in acquisition talks with Chegg Inc
BYJU’S made an offer of $15 per share to 2U’s board last week - currently, the share price of the edtech is at $9.30
The talks with 2U could still fall apart and a deal may not materialise if its board rejects the offer
India’s most valued startup and edtech giant BYJU’S has offered to buy 2U Inc – a US-based listed edtech company for $1 Bn. According to a Bloomberg report, BYJU’S made an offer of $15 per share to 2U’s board last week.
The offer represents a 61% premium to 2U’s closing price of $9.30 on the NASDAQ on Tuesday (June 29, 2022) and gives the edtech company an enterprise value of about $2 Bn. Currently, 2U is valued at nearly $700 Mn and has debt and other liabilities of around $1 Bn.
According to the report, BYJU’S is accelerating its expansion globally through acquisitions, a move similar to the Bengaluru-based startup’s approach in expanding in India. Thus, BYJU’S was likely to bid for either 2U or Chegg Inc (another US-based edtech startup listed on NASDAQ).
Talks with Santa Clara, California-based Chegg haven’t progressed, the report added. Meanwhile, the talks with 2U could still fall apart and a deal may not materialise if its board rejects the offer.
The move comes shortly after BYJU’S expanded its footprint in the US markets by acquiring Palo-Alto-based Osmo. With that, the company announced plans to do a number of strategic acquisitions across all grade levels, and launch a live online learning platform, BYJU’S Future School, in North America.
2U, on the other hand, would be BYJU’S entry into the US’ all-in-one edtech segment since the 14-year-old edtech giant acts as a marketplace for live learning modules across colleges, enterprises and even bootcamps.
This is not BYJU’S first bet at acquiring a bigger fish than itself. In 2021, BYJU’S acquired test prep giant Aakash Institute in a $1 Bn deal. But it has yet again deferred the payment of the deal to Aakash’s investors by two months to August 2022.
With a total of eight companies in its kitty in 2021 alone, BYJU’S has spent over $2.4 Bn to create a unilateral market.
