Byju’s in talks with Joffre Capital to sell US firm Epic for about USD 400 million

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  • Edtech firm Byju’s is reportedly in advanced talks with Joffre Capital Ltd to sell Epic for about $400 million. 
  • Joffre Capital is a tech-focused buyout firm established by Chinese dealmakers. 
  • Byju’s, with support from investors like General Atlantic, Prosus, and Silver Lake, had achieved a valuation of $22 billion in 2022. 
  • The move is seen as an effort to secure financial support and alleviate the company’s ongoing financial challenges, according to sources cited by Bloomberg News. 
  • Byju’s acquired California-based reading platform Epic in July 2021 for $500 million in a cash-and-stock deal. 
  • The embattled start-up has been looking since September to sell both Epic and Great Learning, a higher education and upskilling firm to raise $1 billion to clear a $1.2 billion term loan. 

Indian ed-tech company Byju’s is reportedly in the final stages of discussions to sell its US-based children’s digital reading platform, Epic! Creations, to private equity fund Joffre Capital for approximately $400 million.

Byju’s has been actively seeking to raise up to $1 billion by divesting two entities: Great Learning and Epic, as part of its broader strategy to streamline its operations and address its outstanding financial obligations.

The sale process for Epic is being overseen by Moelis and Co, and a final agreement could be reached as soon as this month, as mentioned in the report.

Byju‘s, with support from investors like General Atlantic, Prosus, and Silver Lake, had achieved a valuation of $22 billion in 2022. However, the company has faced a series of challenges, including the resignation of its auditor and board members, along with the ongoing negotiations related to a $1.2 billion loan repayment over the last several months. The embattled start-up has been looking since September to sell both Epic and Great Learning, a higher education and upskilling firm to raise $1 billion to clear a $1.2 billion term loan.

Byju’s acquired California-based reading platform Epic in July 2021 for $500 million in a cash-and-stock deal. It ran a digital reading platform for children aged 12 or younger. Epic is used by 90 percent of the elementary schools in the US, with participation from more than two million teachers and 50 million kids.

A deal could be finalized as early as this month, though no final decision has been made, the report said. There is also the possibility that Byju’s could seek to keep the assets for a longer period.

Joffre Capital is a tech-focused buyout firm established by Chinese dealmakers. Its founders include James Lu, a former executive at Chinese search engine Baidu Inc. Lu was reportedly part of the investor group that bought the gay dating app Grindr from Chinese internet company Kunlun Tech Co in 2020.

Other founders of the company are executives in technology and finance who have held senior positions at Amazon.com, Warburg Pincus, and Goldman Sachs.

 

(With inputs from agencies)

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