SoftBank-backed Indian edtech firm Unacademy co-founder and chief executive Gaurav Munjal announced in a social media post that they have signed a term sheet with rival upGrad for its acquisition in a share swap deal.
upGrade Acquiring Unacademy in 100% Share Swap Deal
According to Munjal, the transaction would be structured as a 100% share swap, with the valuation to be disclosed only after the deal closes and the papers are filed.
The same is confirmed by the upGrad chairman Ronnie Screwvala, who separately confirmed the agreement in a post on X.
Moving ahead, Munjal affirmed he would remain Unacademy’s co-founder and CEO, with a goal of building online products for learners in India and globally.
He said, “In the last one year, a lot has happened at Unacademy,” while outlining steps the company had taken to streamline operations and sharpen its product focus.
Further adding, Unacademy had consolidated company-operated centres with franchise partners so it could refocus on what it does best – which is building online education products.
He also said the company has completed a Rs 50-crore ESOP buyback, with nearly 40% of former employees already participating.
Implacable Timing
The timing of this deal is implacable as it comes as Unacademy’s valuation has dropped significantly from its pandemic-era high.
Moving ahead, Munjal said the company’s valuation had fallen from its $3.5-billion peak three years earlier to less than $500 million, in a note posted on X in December to mark the startup’s 10th anniversary.
So far, Unacademy has raised about $854.3 million across 13 funding rounds, as per the information provided by the PitchBook, with investors including SoftBank, Tiger Global, General Atlantic, and Peak XV Partners.
Munjal noted, “Unacademy helped invent the Modern EdTech Playbook. Along the way, we lost some focus and market share, and the sector itself has not seen enough real product innovation in recent years.”
Munjal would stay on to build Unacademy and focus on creating online education products “that learners love” , said Ronniee Screwvala the upGrad co-founder, in a separate post on X.
The two sides had also agreed to a break fee if the transaction does not close according to Screwvala.
Coming to Bengaluru-based Unacademy, it is an edtech company that operates an online learning platform offering live classes, recorded courses, and test preparation programmes focusing the students who are preparing for competitive exams and professional qualifications.
