Aakash Educational Services Welcomes Back Aakash Chaudhry as New CEO in BYJU's Reshuffle

The acquisition of Aakash by BYJU's in April 2021 was a significant move in the edtech sector. The deal involved a combination of equity and cash, with 70% of the payment being in cash and the remaining 30% in equity. This arrangement meant that both Aakash's promoters and private equity firm Blackstone, which owns about 12% of Aakash, would receive shares of Think & Learn Pvt.

However, this transaction faced challenges, with Aakash's promoters initially rejecting the share-swap deal and demanding cash for the remaining component. Moreover, BYJU's encountered difficulties with its structured debt, ultimately defaulting on the loan. This prompted a move by Davidson Kempner, a US-based investor linked to future cash flows of Aakash, to seek control of the company. BYJU's was only able to raise approximately $95 million of the committed $250 million, as Davidson Kempner withheld the balance after the default.

To resolve these financial issues, BYJU's is in discussions with Manipal Education and Medical Group (MEMG) Chairman Ranjan Pai, an early investor in BYJU's. Pai is expected to invest approximately $250 million in tranches, starting with an initial investment of $170 million. As a result, Byju Raveendran's stake in Aakash will decrease to 9% from about 27%.

Aakash Chaudhry's return to the helm of Aakash Institute is seen as a significant step in stabilizing the company's future. The ongoing efforts to resolve financial matters and shareholder issues indicate that BYJU's remains committed to its investment in Aakash. As these developments unfold, they will undoubtedly impact the edtech landscape in India, showcasing the ever-evolving dynamics within the industry.