Byju’s, the online education provider and India’s most valued startup is in advanced talks to go public through a merger with one of Churchill Capital’s special-purpose acquisition companies, reported Bloomberg. 

A special purpose acquisition company (SPAC) is a corporation formed for the sole purpose of raising investment capital through an initial public offering (IPO).

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Byju’s has conducted negotiations with many potential SPAC partners and is the farthest in reaching a deal with Michael Klein’s Churchill Capital. Churchill Capital Corp. VII, which trades on the New York Stock Exchange, raised more than $1.3 billion in a February offering.

According to the preliminary parameters negotiated, Byju’s would raise around $4 billion and seek a valuation of approximately $48 billion. According to market research firm CB Insights, the startup is worth $21 billion. While an announcement might be made as early as January, the discussions are not yet complete. According to Bloomberg’s sources, Byju’s or Churchill might yet opt-out of such a deal, and Byju’s could explore an IPO in India next year.

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The company had previously considered a SPAC merger with Michael Dell’s MSD Acquisition Corp. and Altimeter Capital Management. Under the country’s existing legislation, firms located in India are not permitted to go public in the United States through conventional initial public offerings.

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Byju’s Raveendran, a former teacher who founded and leads the Bangalore-based business, offers K-12 lessons and video material to millions of Indians preparing for the country’s competitive engineering and medical entrance examinations. It also provides students in North America, the Middle East, and Latin America with one-to-one coding, math, and reading sessions and materials.

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Byju’s had planned to submit preliminary documents for a traditional initial public offering as soon as the second quarter of 2022 and was also exploring a SPAC merger, Bloomberg News reported in September.  This was an acceleration of previous intentions to go public in 12 to 24 months. The startup and its bankers had discussed a value of $40 billion to $50 billion, with the ultimate decision depending on financial outcomes and investor demand.