According to a source, private equity firm Blackstone has received the final payment of Rs 1,983 crore from edtech decacorn Byju’s for the purchase of Aakash Educational Services.
By June 2022, the deadline for the corporation to pay the outstanding balance owed to Aakash’s investor Blackstone had been postponed to September 23, 2022.
Details on Byju’s pays Blackstone’s outstanding debts in the $1 bn Aakash transaction
The $950 million major acquisition was made public in April 2021. Prior to the transaction, Blackstone held close to 38% of the market share of the online coaching network.
In the last 18 months, the Tiger Global-backed company has acquired 13 companies for a total of close to $3 billion, including Aakash, Great Learning ($650 million), Epic ($500 million), and Toppr ($150 million).
On September 14, Byju’s, owned and run by Think & Learn Pvt Ltd, released its much-delayed financial results for the fiscal year 2020–21. The company’s combined losses increased over 20 times, from Rs 231.69 crore in FY20 to Rs 4,588.75 crore for the fiscal year that ended in March 2021. Operations’ revenue increased slightly from Rs 2,189 crore in FY20 to Rs 2,280.26 crore in FY21. From Rs. 2,511.77 in the prior fiscal year to Rs. 2,428.39 crores in FY21, its entire income decreased by a little over 3%.
The total expenditures of the company increased from Rs 2,873.34 crore in FY20 to Rs 7,027.47 crore in FY21. Notably, business marketing expenses, which totaled Rs 2,251 crore last year, up from Rs 900 crore the year before, accounted for the majority of its spending.
According to the company’s audit agency Deloitte Haskins and Sells, a change in how it recognizes revenue is what’s to blame for the muted increase. Previously, it fully recognized streaming service revenues at the start of multi-year subscriptions; currently, they are booked over the course of use. Additionally, until the payments are received, the loans that its clients have taken out cannot be recognized. As a result, the business was unable to record Rs 1,156 crore in revenue from deferred payment terms in FY21.
“The business grew significantly in FY21 over FY20, but as this is the first year that new revenue recognition began due to a shift in the Covid business model, about 40% of the revenue was delayed to succeeding years. According to BYJU’S auditors’ recommendations, modifications were made to the way the company recognizes revenue, which led to the rationalized rise between FY21 and FY20, the company stated at the time the results were released.
According to a statement from the company, the Bengaluru-based company recorded around Rs 10,000 crore in gross revenues in FY22, of which Rs 4,530 crore came between April and July. The business added that since then, the revenue of Aakash and the higher education platform Great Learning has doubled
