Amid the funding winter and other macroeconomic uncertainties, ed-tech giant Byju’s is set to raise $1 billion in a mix of equity and structured instruments at its current valuation of $22 billion, as per a report in the Business Standard.
The sources have told the publication that $700 million of the $1 billion will be raised through equity. The report says that Byju's is in discussions to raise this tranche with ADQ and other sovereign wealth funds in Abu Dhabi. Structured instruments would be used to raise the remaining $300 million. Investors like Davidson Kempner Capital Management, Oaktree Capital Management, and Apollo Management are among those with whom Byju's is in discussions for this amount.
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“The final stages of due diligence are going on. The money is expected to come soon,” a person with the knowledge of the development told Business Standard. The report cited another unnamed person as saying, “These investors do deep due diligence before investing. This will be a huge win for Byju’s founder Byju Raveendran once he closes the deal. And this would be the largest funding round in the tech winter.”
According to the report, this new funding round is expected to help Byju’s pay a portion of the $1.2 billion Term Loan B that the company raised in 2021.
The ed-tech giant had reportedly sought more time from lenders in order to renegotiate an agreement governing a loan that is in breach of covenants, according to people familiar with the matter.
This development comes just days after the news came that as of now no FEMA violations were found in ED searches at Byju’s premises. The ED had earlier carried out searches at three premises linked to BYJU'S in Bengaluru, in connection with alleged foreign exchange violations.