The Economic Times reported that Apollo Global Management and Abu Dhabi Fund 10X AD are in discussions to invest in Byju’s parent company, Aakash. Byju’s CEO, Byju Raveendran, is reportedly in talks for investment in the company or its subsidiary, Akash Education Services (AES), with US private equity giant Apollo Global Management, Abu Dhabi-based fund 10X AD, and Disrupt AD, ADQ’s venture capital arm in Abu Dhabi. A minimum of $400 million to $600 million is sought from new investors by the failing edtech business.

A fund pool called 10X AD focuses on structured investments in late-stage technological startups. As the Bengaluru-based company works to turn a corner after coming under fire for more than 18 months for corporate governance, audit failures, business practices, subpar financial results, and mass layoffs, it is unclear if 10X AD will head an investor consortium of family offices and extremely wealthy individuals in Abu Dhabi or go it alone and invest $150-200 million.

The venture capital arm of ADQ based in Abu Dhabi, Disrupt AD, may also increase its initial commitment, according to the people. Disrupt AD invested in the business in 2021 after taking part in a $350 million fundraising round that put the company’s worth at $16.5 billion, making it the most valued edtech business in the world at the moment.

Other Investors

Another Gulf-based investor in the business is Qatar Investment Authority. Other investors include ”General Atlantic, Sequoia, Silverlake, Sofina, Tencent, Tiger Global, Naspers, and CPPIB”. Additionally, investors include Times Internet, a division of the Times Group that publishes ET.

In order to secure a $200 million–$250 million structured investment for Aakash, Byju also contacted Apollo Global Management, a prominent US private equity and alternative asset management firm. This could be done at a discount compared to the following round or using a preferred instrument with a fixed, beforehand-agreed internal rate of return (IRR) and downside protection. Apollo had initially turned down Byju’s request to join the cap table with the parents.

The market anticipates Aakash to generate positive EBITDA and sales of $430 million in FY23, up from $250 million in FY22.

Raveendran Byju will reduce his 30% ownership of Aakash through a capital raise through the secondary sale of shares, giving him more money to negotiate the company’s Term Loan B (TLB). In order to restructure the Bengaluru-based company’s $1.2 billion (Rs 9,600 crore) Term Loan B, which is currently under review, lenders have demanded up to $200 million (Rs 1,600 crore) in prepayment and a higher rate of interest, according to people with direct knowledge of the situation.

According to persons briefed on the situation, Byju’s currently has $650 million in its foreign accounts and roughly Rs 1,500 crore ($183 million) stashed in liquid assets in India. Ajay Goel, a former Vedanta executive, was recently named byju’s new chief financial officer. That hiring is crucial since Byju’s needs to finalise the terms of its $1.2 billion TLB, one of the biggest loans an Indian company has ever obtained.

According to the business, Goel will collaborate on strategy creation, capital planning, and financial analysis with the founders and senior executives. On April 3, Raveendran issued a statement in which he stated, “His strategic thinking and financial acumen will be instrumental in helping us create even more value for our stakeholders.”