No Respite: BlackRock Slashes BYJU'S Valuation By 95% To $1 Bn

Prosus Writes Off Its Entire Stake Worth Around $500 Mn In BYJU’S

SUMMARY

As of the end of October last year, BlackRock, which owns less than 1% stake in BYJU’S, stated that it assessed the value of BYJU’S shares at approximately $209.6 each

In last April, the US-based asset manager slashed the valuation of the edtech major by nearly 50% to $11.5 Bn

In November, Dutch investor Prosus marked down the value of its stake in edtech giant BYJU’S, taking the valuation of the troubled company to under $3 Bn

US-based asset manager BlackRock has once again slashed its valuation of edtech major BYJU’S, this time around 95% from $22 Bn to $1 Bn.

In October last year, BlackRock valued BYJU’S shares at around $209.6 each, a significant drop from the peak of $4,660 in 2022. The asset manager holds less than 1% of the edtech giant, Techcrunch reported.

Prior to that, in April, BlackRock slashed the valuation of the edtech major by nearly 50% to $11.5 Bn, a sharp markdown from the $22 Bn at which the edtech decacorn was last valued in 2022.

In its assessment, the asset manager, which owns less than 1% stake in BYJU’S, is said to have marked down the value of its shares in the startup to $2,855 per share from $4,660 per unit in April 2022.

It is pertinent to mention here that BlackRock is not the only investor that has significantly lowered its valuation of BYJU’S. In November, Dutch investor Prosus, which holds over 9% of the troubled edtech major, valued it at sub $3 Bn.

During its earnings call, Prosus interim chief executive Ervin Tu said BYJU’S has been facing multiple challenges. Prosus, which owns a 9.6% stake in the startup, has been marking down the valuation of its stake in the startup since the beginning of 2023.

At a time when BYJU’S is facing multiple legal and governance hassles, BYJU’S CEO Byju Raveendran reportedly asked its investors to infuse $300 Mn into the company in lieu of larger shareholding in the company.

The edtech decacorn has raised around $6 Bn in funding so far from marquee investors including the Qatar Investment Authority, General Atlantic, Sumeru Ventures, Vitruvian Partners, BlackRock, Peak XV Partners, Chan Zuckerberg Initiative, Tencent, and Tiger Global.

BYJU’S has been facing a series of challenges, including legal disputes with lenders regarding the repayment of its $1.2 Bn Term Loan B, financial pressure, substantial cash depletion, widespread layoffs, departures of key leadership figures, the resignation of auditors, and the exit of significant stakeholders.

Additionally, the company is under scrutiny by the Enforcement Directorate (ED) for alleged violations of the Foreign Exchange Management Act (FEMA).

Last month, BYJU’S held its annual general meeting (AGM) where the stakeholders approved its financial statements for FY22.

BYJU’S earlier said that excluding all acquisitions, its parent entity – Think and Learn Private Ltd – reported an EBITDA loss of INR 2,253 Cr in FY22, which stood at INR 2,406 Cr in FY21. The entity’s total income stood at INR 3,569 Cr in FY22 as against INR 1,552 Cr. However, it did not disclose other important metrics.