Giants meet. Pen $1 billion deal

Wednesday, 07 April 2021 | Pioneer Avenues

The acquisition of AESL by Byju’s will be a game changer. PIONEER AVENUES tells you what the merger is about, costs involved and how it will affect the two

Mergers of two giants is not new news. In the past, there have been some very big mergers — the biggest has been the Vodafone and Mannesmann. It took place in 2000 and was worth over $180 billion. India, too, has seen its share of giants joining hands. A case in points is the acquisition between Flipkart Group andWalmart India Pvt Limited.

In yet another merger, BYJU’S, the ed-tech giant on Monday announced its strategic partnership with Aakash Educational Services Limited (AESL), a leader in test prep services.

This partnership brings together two of the largest education brands in India. It combines Aakash’s pedagogy expertise in the test-prep segment with BYJU’S content and tech capabilities. This is not all, BYJU’S will make further investments to accelerate Aakash’s growth.

This is not the first time that AESL has gone into a partnership, in 2019, it partnered with Blackstone to create India’s largest digitally enabled, omni-channel test preparation company.

Byju Raveendran, founder-CEO, BYJU’S said: “I am happy to have AESL, a market leader and the most trusted name in the test prep services, on board with us. Our complementary strengths will enable us to build capabilities, create engaging and personalised learning programmes. The future of learning is hybrid and this union will bring together the best of offline and online learning, as we combine our expertise to create impactful experiences for students.”

The pandemic has brought the importance of the blended format of learning to the forefront. “As we unite our forces to bring together decades of expertise and experience, this partnership will further accelerate Aakash’s growth and success,” Raveendran said.

The addition of Aakash is a significant step towards strengthening BYJU’S product offering. It reiterates the company’s focus on creating impactful learning products for students by adding more verticals, subjects, and languages to the same platform. “At Aakash, we are looking to transform student experiences by steering innovative and digitally-enabled learning solutions. Together, we will work towards building an omni-channel learning offering that will accelerate test-prep experience to the next level. While this partnership will enhance our operational verticals, Aakash will continue to operate as a separate entity with the same passion and commitment with which its founder-chairman JC Chaudhry incepted it. We are excited to partner with them and will strive to deliver long-term value to our students, employees, investors, and other stakeholders,” Aakash Chaudhry, Managing Director, AESL, said.

Amit Dixit, Co-Head of Asia Acquisitions and Head of India Private Equity at Blackstone, said that they invested in AESL because it is one of the leading education brands in India with a professional management team, best-in-class corporate governance and a 33-year track-record of exceptional results.

“We have always believed omni-channel will be the winning model in test prep and tutoring and we look forward to being a part of the partnership between the two foremost companies in Indian supplementary education. The combination is highly synergistic and we are excited to help build India’s largest education company,” Dixit said.

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