Byju's long-running battle with its global lenders may finally be heading towards a resolution, with creditors reportedly willing to settle in exchange for a significant stake in Aakash Educational Services, one of India's largest coaching chains. The proposed agreement could bring an end to a legal dispute that has stretched across multiple countries and marked one of the most dramatic downfalls in India's startup ecosystem.
Byju's global lenders are said to be in advanced discussions to acquire around a 30 percent stake in Aakash Educational Services while withdrawing all legal proceedings against Byju's founder Byju Raveendran.
The settlement talks involve Raveendran, US-based Glas Trust, which represents a group of lenders, Aakash Educational Services and Manipal Health.
The dispute began after Glas Trust accused Byju's management of misusing funds and defaulting on a $1 billion term loan. Following Byju's bankruptcy proceedings in India in 2024, the lenders launched legal action against the company and its founder in courts across India, Singapore and the US. Raveendran and Byju's have consistently denied any wrongdoing.
If the settlement is finalised, all parties are expected to withdraw their legal cases, ending a conflict that has weighed heavily on the once high-flying edtech company.
Byju's acquired Aakash Educational Services in a $1 billion deal in 2021 during its rapid expansion phase. However, after the company's financial troubles deepened, its holding in Aakash was diluted, with Manipal Health emerging as the largest shareholder. The ongoing negotiations reportedly value Aakash at around $2 billion.
Aakash operates more than 300 coaching centres across India, preparing students for medical and engineering entrance examinations as well as school-level academic programmes. The institute employs more than 5,000 faculty members and last reported annual revenue of about $254 million.
Byju's was once India's most valuable startup, with operations in more than 21 countries and rapid growth during the Covid-19 pandemic. However, mounting debt, governance concerns and legal disputes triggered a dramatic collapse.