Byju’s, the Indian educational technology start-up, is in talks to go public in the United States by partnering with a blank check company led by Michael Klein’s Churchill Capital, in a deal that would value the company to more than $40 billion.
Two people with direct knowledge of the talks said talks are at an early stage and come as Byju has assessed other mergers with US-listed special purpose acquisition companies and is considering a public offering initial in India.
One of the people said Klein’s Churchill Capital Corp VII Spac offered to partner with Byju’s at a valuation of about $48 billion and raise about $4 billion in new funds. However, another person said the approach values Byju at around $40 billion and will allow it to raise around $2 billion in new funding.
Any deal at those levels would make it the largest ever combination of a private company with a Spac, beating the nearly $40 billion valuation attained by Singapore’s Grab through its merger earlier this year with Altimeter, a Spac. launched by the eponymous American cover. funds.
Churchill VII is the largest Spac led by Klein, a former Citigroup executive and prolific Spac sponsor, and has a cash position of $1.3 billion that it raised in February.
MSD Acquisition Corp, a blank check vehicle formed by the investment group that manages Michael Dell’s assets, and Altimeter have also been in talks with Byju’s, one of the people added. The sharp drop in Grab shares after its deal with Altimeter does not appear to have dampened enthusiasm for a combination with Byju’s, which was valued at $21 billion in its last public round. Byju declined to comment.
Founded in 2011, Byju’s has raised billions of dollars from investors including Tiger Global, Sequoia and Naspers.
It has seen rapid growth in its learning apps for children, driving demand as prolonged school closures in India following the Covid-19 pandemic have forced parents to pay for apps. additional online education programs.
Byju’s has 7 million paying users and over 100 million registered students. India has the largest school-age population in the world with around 300 million children.
A wave of other Indian tech companies have recently gone public, including fintech group Paytm and food delivery app Zomato. Hotel company Oyo has filed for an IPO.
Churchill, who also declined to comment, has had mixed success with his blank check deals.
His merger with data analytics firm Clarivate worked well, but Churchill’s deal with healthcare provider Multiplan ran into problems.
The deal between Churchill Capital Corp IV and Saudi-controlled electric vehicle group Lucid Motors has also been rocky. Shares of Lucid have jumped more than 300% since the merger, but US securities regulators are reviewing the forecasts the automaker presented when it went public.