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upGrad set to acquire Unacademy in deal with break fee clause

EntrackrEntrackr · 1d ago
upGrad set to acquire Unacademy in deal with break fee clause
Medial

Online higher education platform upGrad has signed a term sheet to acquire edtech firm Unacademy in an all-stock transaction. The firms will not disclose the valuation until the deal is completed and formally filed. The term sheet was signed after earlier talks between the two companies collapsed in January due to differences over valuation. Announcing the development, upGrad co-founder Ronnie Screwvala said the deal will be structured as a share swap and includes a break fee if the transaction does not close. Importantly, Unacademy’s co-founder and chief executive Gaurav Munjal will continue to lead the company and focus on building online learning products. Screwvala stated, “We at upGrad have signed a term sheet to acquire Unacademy in an all-stock deal, with founder and CEO Gaurav Munjal staying on to build Unacademy and focus on creating online education products that learners love.” He added that the combined entity could benefit from Unacademy’s product capabilities and upGrad’s broader learning ecosystem. According to Screwvala, upGrad’s integrated model spanning segments from K12 to lifelong learning could gain further momentum if the transaction closes. Munjal confirmed the development and said the proposed acquisition will be executed through a 100% share swap deal. Highlighting Unacademy’s recent changes, Munjal said the company has spent the past year restructuring parts of the business. “We consolidated company-operated centres with franchise partners so we could refocus on building great online education products,” he said. The company also completed a Rs 50 crore ESOP buyback, with nearly 40% of former employees participating, Munjal said. He added that Unacademy currently has more than $100 million in cash reserves. On the financial side, Unacademy reported a 16% year-on-year decline in revenue to Rs 826.3 crore in FY25 from Rs 988 crore in FY24. However, the SoftBank-backed firm reduced its EBITDA loss by 38% to Rs 305 crore and cut its net loss by 31% to Rs 436 crore.

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