SUMMARY
LEAD would fund the acquisition of Pearson’s K-12 learning business in India through a combination of new fundraising and internal accruals
In its K-12 learning portfolio, Pearson India caters to private, English medium CBSE and ICSE schools, offering learning solutions via books and digital modes
With the acquisition, LEAD said it will immediately expand its reach to over 9,000 schools and enhance its product portfolio to cater to the whole spectrum of over 5 Lakh private schools
Edtech unicorn LEAD on Friday (January 6) said that it has entered into an agreement with the London Stock Exchange-listed education group Pearson to acquire its K-12 learning business in India.
LEAD would fund the acquisition of Pearson’s K-12 learning business in India through a combination of new fundraising and internal accruals.
With the acquisition, LEAD will immediately expand its reach to over 9,000 schools and further enhance its product portfolio to cater to the whole spectrum of over 5 Lakh private schools in India, the edtech startup said in a statement.
The development comes weeks after LEAD raised INR 35 Cr from venture debt firm Alteria Capital.
The acquisition, which is subject to customary closing conditions, is expected to be completed by Q1 2023, LEAD said.
In its K-12 learning portfolio, Pearson India caters to private, English medium CBSE and ICSE schools, offering learning solutions via books and digital modes to ensure learning continuity at home. It also offers teacher resources.
“School edtech is poised for sustained growth post Covid and with the acquisition of the local K-12 learning business of Pearson India, we will be able to reach more schools and students in the service of our mission to provide excellent education to every child,” said Sumeet Mehta, cofounder and CEO of LEAD.
Founded in 2012 by Mehta and Smita Deorah, LEAD enables schools to combine technology, curriculum, and pedagogy in an integrated teaching and learning system. LEAD claims that its integrated system is available to schools in over 400 towns and cities across India, reaching more than 1.2 Mn students and over 25,000 teachers.
EY was the exclusive financial advisor to LEAD for the deal.
The acquisition comes despite a funding crunch in the startup ecosystem, which has led to a significant number of job cuts across startups, particularly in the edtech space. In August last year, LEAD also laid off almost 100 employees citing performance-related issues.
Just a few months prior to that, in January, LEAD entered the unicorn club by raising $100 Mn at a valuation of $1.1 Bn. The Series E funding round was led by WestBridge Capital and GSV Ventures.
Despite major restructuring by startups in the Indian edtech space, which led to over 7,500 full-time and contracted employees losing their jobs in 2022, several acquisitions have taken place in the recent past.
Edtech major Vedantu, which laid off over 1,000 employees in multiple rounds in 2022, acquired a majority stake in Karnataka-based test preparation platform Deeksha for $40 Mn in October.
upGrad acquired companies including test-preparation startup Exampur and B2B edtech startup Harappa Education in 2022. Earlier this week, it was reported that Harappa Education laid off around 40% of its employees.
Besides, B2B edtech startup Uolo acquired online learning platform Tekie earlier this week. Edtech unicorn PhysicsWallah also completed the acquisition of two startups – PrepOnline and Altis Vortex – in October.
