Exclusive: Byju’s in talks to raise $500 million via Term Loan B

By Administrator_India

Capital Sands

India’s most valued startup Byju’s is in talks to raise $500 million in a debt round through the TLB or Term Loan B route from global investors as it gears up for an initial public offering (IPO), as per a source.

The deal is at an early stage and the company has started working with Morgan Stanley for the same.

“It is at a term sheet stage,” said the source quoted above.

TLB refers to a tranche of senior secured syndicated credit facility from global institutional investors. OYO was the first company to have raised this debt in India. Moneycontrol reported about it on July 16.

Conventionally, TLB proceeds are used either to refinance the existing debts by a company or to make overseas acquisitions with an aim to enhance their offerings.

In the case of OYO, $660 million was raised to retire their existing debts and pump up its operations and product technology as it explores the market for a potential IPO.

“A TLB makes the balance sheet look healthier and is also seen as a prep for accessing the public market,” said an industry expert, requesting anonymity.

Byju’s and Morgan Stanley did not respond to media queries.

However, in an interaction with Moneycontrol last month, Byju Raveendran, founder and chief executive officer of Byju’s said that the company was considering a 12-18 months timeline for an IPO.

Byju’s, which has spent over $2 billion in acquisitions in the last six months, also has plans for a couple of more acquisitions to drive international expansion.

It last announced the acquisition of upskilling platform Great Learning for $600 million. Earlier this year, the company acquired US-based reading platform Epic, educational games maker Osmo, coding startup WhiteHat Jr and offline test preparation firm Aakash Educational Services Limited. Aakash alone was bought for a whopping $1 billion.

Valued at $16.5 billion, the company last announced a fundraise of $350 million from UBS, Blackstone, ADQ, Phoenix Rising & Zoom founder Eric Yuan in June.

In the last 18 months, it raised over $1.5 billion which is much more than the total funding raised by the company earlier. This euphoria is broadly driven by the growth of online education which got turbocharged by COVID-19 in India.

According to data from CB Insights, Byju’s is now the 11th most valuable startup in the world. Its revenue doubled in the pandemic year as more students relied on online classes and stood at Rs 5,600 crore for the year ended March 2021.

Earlier this month, distant rivals Unacademy and upGrad also raised funding. While Unacademy raised $440 million led by sovereign wealth fund Temasek, valuing it at $ 3.4 billion — a ten-fold jump in 18 months, upGrad entered the much-coveted unicorn club with a fundraise of $185 million from Temasek, IFC, and IIFL at a valuation of $1.2 billion.

On the domestic front, technically MCX Silver September above Rs 62500 level could see Rs 63,200-63,900 levels. Support is at Rs 62,000-61,400 levels”, Iyer added.

Investors are now focused on Fed Chair Jerome Powell’s speech at the annual Jackson Hole, Wyoming, symposium awaiting guidance on the US central bank’s taper plans.

Silver holdings in iShares ETF fell by 21.6 tonnes to 17,085.32 tonnes. The fund NAV is trading at a premium of 0.76 percent.

The US dollar index traded marginally higher at 93.07, up 0.12 percent against the major cross in the afternoon session.

The spot gold-silver ratio stands at 76.14 to 1, indicating that silver has outperformed gold.

MCX Bulldesk was slightly up 1 point, or 0.01 percent, to 14,248 at 3:13 pm. The index tracks the real-time performance of MCX Gold and MCX Silver futures.

In the futures market, September silver delivery touched an intraday high of Rs 63,091 and a low of Rs 62,736 per kg on the MCX. So far in the current series, the precious metal has touched a low of Rs 61,227 and a high of Rs 75,215.

Silver delivery for the September contract gained Rs 133, or 0.21 percent, to Rs 63,060 per kg at 3:20 pm with a business turnover of 7,987 lots. The same for December increased Rs 140, or 0.22 percent, to Rs 63,708 per kg with a turnover of 6,006 lots.

The value of September and December’s contracts traded, so far, is Rs 621.08 crore and Rs 157.89 crore, respectively.

Similarly, the Silver Mini contract for August mildly up Rs 46, or 0.07 percent to Rs 63,192 on a business turnover of 13,806 lots.

At 0956 (GMT), the precious metal was flat quoting at $23.65 an ounce in New York.

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