(MENAFN- Trend News Agency)
Byju's, an India online education startup, is in discussions to
acquire a US target and likely to bid for either Chegg Inc. or 2U
Inc., according to people familiar with the matter, Trend reports citing mint .
The Bangalore-based company has held talks with both Santa
Clara, California-based Chegg and Lanham, Maryland-based 2U and the
total value of a deal could be about $2 billion, said the people,
who asked not to be named because of the sensitive nature of the
negotiations. Chegg's market value was $2.3 billion as of Friday's
close, while 2U had a market value of $756 million and more than $1
billion in debt and other liabilities.
Byju's and its bankers are evaluating the financials of the two
companies and aim to make an offer in the coming weeks, said one of
the people. They have yet to agree on any final price and it's
possible no deal will ultimately materialize, the people said.
Byju's declined to comment, while Chegg and 2U didn't respond to
requests for comment. Byju's, one of the world's most valuable
startups with backing from Tiger Global Management and Mark
Zuckerberg's Chan Zuckerberg Initiative, is seeking to capitalize
on a worldwide market rout and build its business through
acquisitions, one of the people said. Both Chegg and 2U have seen
their shares tumble more than 75% from July through Friday's market
The Indian education pioneer is the country's most valuable
startup, with a valuation of $22 billion, according to the market
researcher CB Insights. Its backers also include Silver Lake
Management, Naspers Ltd., and Mary Meeker's Bond Capital.
Byju's, whose parent company is and formally known as Think &
Learn Pvt, has already lined up conditional debt commitments of
more than $1 billion to finance the acquisition from banks
including Morgan Stanley and JPMorgan Chase & Co. and Goldman Sachs
Group Inc. said the people. Representatives for the banks declined
Bloomberg News reported last week that the company was in talks
with lenders to raise more than $1 billion in acquisition
Byju's, founded by former teacher Byju Raveendran in 2015, has
already been leading a consolidation wave in online education. In
the past year, it bought the US reading platform Epic for $500
million, the Singaporean service Great Learning for $600 million,
the US coding site Tynker for $200 million and Austria's
mathematics operator GeoGebra for about $100 million.
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