Summary – Great Learning Founders wants to buyback Great Learning from Byju’s
- Great Learning’s founders are in talks with investors for a management buyback from BYJU’S, aiming to regain control of the company acquired for $600 million in 2021.
- Discussions include potential equity stake increases post-buyback, with various structural options being explored.
- This move comes as BYJU’S faces financial strains, including loan repayment issues, delayed financial reporting, and a large-scale restructuring involving over 4,000 layoffs.
The co-founders of Great Learning, an edtech company acquired by BYJU’S in 2021 for $600 million, are currently engaged in discussions with potential investors to reclaim ownership of their startup. According to a report by Mint, this management buyback plan aims to put the edtech firm back under its founders’ control, while providing equity returns to the investors involved.
This potential investment is driven by the investor’s interest in maintaining the involvement of Great Learning’s original founding team and current management. Various structural options are being considered to finalize this arrangement, with the details still under discussion.
A possibility being explored includes the founders negotiating for an increased equity share post-buyback with the investor consortium. These talks are in early stages, and it’s expected that a more formalized process will begin following advancements in the deal concerning Epic, another entity under BYJU’S umbrella.
Recently, it was reported that BYJU’S, facing financial constraints, is seeking to raise between $800 million and $1 billion through the divestment of Epic and Great Learning to manage its $1.2 billion Term Loan B.
Great Learning, established in 2013 by Arjun Nair, Hari Nair, and Mohan Lakhamraju, specializes in providing in-depth programs in various tech, data, and business fields.
This news emerges amidst BYJU’S dealing with several challenges, including controversies over a $1.2 billion loan repayment, delayed financial reporting, board member and auditor resignations, and plans to lay off more than 4,000 employees as part of a restructuring initiative. The company has also delayed releasing its FY22 financial figures, scheduling a board meeting in October for their approval and adoption.