The Indian edtech sector could be entering a new consolidation phase. UpGrad, the learning platform backed by Ronnie Screwvala, is in advanced negotiations to buy its competitor Unacademy, according to Moneycontrol. The talks signal a sharp market correction, with Unacademy’s valuation now a sliver of its earlier billion-dollar standing.
What Are the Key Terms of the Proposed Deal?
The acquisition talks are centered on a specific structure. A term-sheet could be finalized within the next three weeks, as per the report. The plan involves spinning off Unacademy’s language-learning app, AirLearn, into a separate entity. The core of Unacademy’s operations, including its network of offline coaching centers and its test-preparation divisions, would then be acquired by UpGrad. This action shows a deliberate focus on the profitable and well-established test-prep industry.
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What Does the Valuation Tell Us About the Market?
The most startling aspect of the deal is the proposed valuation. The deal is expected to value Unacademy between $300 million and $400 million — a steep fall from its $3.44 billion valuation during the 2021 funding boom. The more than 90% decrease highlights the severe market correction and growing pressure within India’s once-booming edtech sector.
Is This Part of a Larger Industry Trend?
The UpGrad–Unacademy talks reflect a larger wave of consolidation in India’s edtech industry. Around the same time, Manipal Education & Medical Group has shown interest in buying the bankrupt parent of Byju’s. The pattern suggests a final shakeout, with financially sound companies taking over failed unicorns as the sector evolves into a leaner, more stable market.
Why is the Hybrid Model Becoming Crucial?
One of the biggest forces behind the ongoing consolidation is a change in business approach. Edtech platforms are increasingly adopting hybrid models that mix online learning with brick-and-mortar centers. Through its IPO, which will largely fund physical center expansion, Physics Wallah embodies the shift toward balancing accessibility with authenticity in Indian education.
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