BYJU'S looking to sell US-based acquisition at $100-mn loss to PE fund: Report

Beleaguered Indian edtech company BYJU’S is in advanced talks to sell its US-based kids’ digital reading platform Epic for about $400 million to Joffre Capital Ltd., Bloomberg reported on Monday.

The report noted that the potential sale of Epic would help BYJU’S raise funds to pay its $1.2 billion term loan. Moreover, language learning app Duolingo has also expressed interest in buying the platform from BYJU’S.

As per the report, dealmakers Moelis & Co. are running the sale process for Epic. The deal could be finalized as early as this month.

Business Today was unable to confirm this development independently.

BYJU’S bought Epic for $500 million in 2021 as part of its global expansion. The US based edtech offers a collection of more than 40,000 books on its online platform, as per its website.

The Indian edtech company and its creditors are locked in conflict over missed interest payments of its Term Loan B.

The company released its FY 2021-22 results this weekend, after a delay of over an year. The company’s revenue came in at Rs 3,569 crore. Its EBITDA (earnings before interest, taxes, depreciation, and amortisation-based) loss of the core business was at Rs 2,406 crore for the year.

BYJU’s has been facing scrutiny from investors as well as regulators. A week before the release of the results, the company’s Chief Financial Officer Ajay Goel resigned. The company’s auditor, Deloitte also resigned earlier this year citing a ‘significant impact’ on its ability to audit the company due to the edtech company’s failure to provide financial data despite repeated requests of the auditor. 

Furthermore, several employees claimed that the edtech company had not been paying provident fund dues to EPFO in June, which it had been collecting from employees. The EPFO started an investigation into the company after which the edtech deposited employee dues. 

Also in June this year, Peak XV Partners (formerly known as Sequoia India), Prosus and Chan Zuckerberg Initiative said that their representatives have resigned from the board of edtech firm BYJU'S.