The Future Aakash IPO Of BYJU’s Raises Debt Of Rs 2000 Crore

The IPO tied to Aakash Educational Services, Byju’s exam preparation business, has concluded a Rs 2,000 crore round from Davidson Kempner Capital in a structured credit transaction against the company’s cash flows on Friday, May 12.

All About The Deal

The deal, finalized on Friday, involved a three-year borrowing facility with an equity upside tied to Aakash’s scheduled upcoming IPO. The non-convertible debentures (NCDs) and a smaller amount of compulsorily convertible debentures (CCDs) were used to raise the money for the transaction. They are based on Aakash’s estimated ultimate valuation in the anticipated initial public offer (IPO), which will correspond to a set coupon rate of 12% annually for the business.

To reach its financial demands, Byju’s will be able to upstream the money obtained from Davidson Kempner to the holding company. 

This follows weeks after agents from the Directorate of Enforcement (ED) examined its office space. The Indian government’s federal financial investigative agency is looking into the edtech unicorn’s compliance with the Foreign Exchange Management Act (Fema) from 2011 to 2013.

The ED Intrusion

After issuing cofounder Byju’s Raveendran many summonses, ED inspectors examined Byju’s offices late last month. Ajay Goel, the business’s recently appointed chief financial officer, was also questioned by ED. 

According to reports, Goel informed the organization that Raveendran made the majority of the choices. As part of its probe into Byju’s, ED intends to write to lenders and banks to get information on different transactions and loans.

As per The Economic Times, Byju’s intends to refinance a portion of the term loan B it acquired in 2021 using some of the fresh funds.

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