According to the people cited above, the transaction, which closed on Friday, is a three-year tenor loan facility with an equity upside linked to Aakash’s planned public listing in the near future. The transaction was raised via a combination of non-convertible debentures (NCD) and a smaller portion of compulsorily convertible debentures (CCDs) linked to Aakash’s final valuation in the IPO, which will roughly translate to around 12% in annualised fixed coupon rate for the company.
“Apart from Davidsion Kempner, Byjus was also in talks with Apollo Global management for the transaction and had also received a term sheet, but eventually decided to go ahead with the former’s offer,” said one of the sources cited above.
Email queries sent to Byju’s and Davidson Kemper did not elicit a response till press time on Friday. A spokesperson of Apollo Global Managed declined to comment.
The cash infusion will allow Byju’s to upstream the cash raised to the holding company to meet its financing needs. This comes weeks after officials from the Enforcement Directorate (ED) searched its office premises. The ED, India’s federal financial probe agency, has been looking into the edtech unicorn’s compliance with the Foreign Exchange Management Act (Fema) norms since 2011.
According to people aware of the matter, Byju’s is expected to use some of the new capital to refinance parts of its TLB–which it had raised in 2021. ET has been reporting about Byju’s efforts to close a negotiation with its creditors who had asked for at least $200 million of prepayment on the $1.2-billion loan.
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