Blackstone paid Rs 1,983 crore for Aakash acquisition

The final tranche of Rs 1,983 crore was paid to private equity firm Blackstone by Edtech decacorn Byju s for the acquisition of Aakash Educational Services, a source familiar with the development told Business Today.

The company was supposed to clear the pending amount of Blackstone acquisition by June 2022, which was then deferred to September 23, 2022.

The big-ticket acquisition, worth $950 million, was announced in April 2021. Blackstone owned more than 38 per cent of the online coaching chain before the acquisition.

Tiger Global backed company has made acquisitions worth close to $3 billion over 13 deals in the past 18 months, including Aakash, Great Learning $650 million Epic $500 million and Toppr $150 million Byju s, owned and operated by Think Learn Pvt Ltd, which has announced its much-delayed financial results for the financial year 2020 -- 21 on September 14. The company's consolidated losses increased by nearly 20 times to Rs 4,588. For the financial year ended March 2021, 75 crore came from Rs 231.69 crore in FY 20. Revenue from operations grew marginally from Rs 2,280. In FY 21, 26 crore were generated from Rs 2,189 crore in the previous year. Its revenue fell by 3 per cent to Rs 2,428, a little over 3 per cent. There were 39 crore in FY 21 from Rs 2,511 The company's overall expenses were Rs 7,027. In FY21, 47 crore was up from 2,873 p.a. In FY 20 there were 34 crore. A majority of its spending last year was attributed to business promotion expenses, which is now Rs 2,251 crore, up from Rs 900 crore in the previous fiscal.

The company attributed the subdued growth to a change in the way it recognises revenue, as mandated by its audit firm Deloitte Haskins and Sells. In the past, it recognized revenues of streaming services fully at the beginning of multi-year subscriptions that are now being booked over the period of consumption. The loans availed by its customers can't be recognised until the instalments are collected. In FY 21 the company was unable to book 1,156 crore of revenue due to deferred payment terms.

There was significant business growth in FY 21 over FY 20 but since this is the first year where new revenue recognition started because of a Covid-related business model change, almost 40 per cent of the revenue was deferred to subsequent years. The company said that the growth between FY 21 and FY 20 was a result of the changes made in the way BYJU S recognises its revenue, as advised by its auditors.

In FY 22, the Bengaluru-based firm generated nearly 10,000 crore in gross revenues, Rs 4,530 crore of which came during the April-July period. Aakash and the higher education platform Great Learning have doubled their revenues, according to the company.