The EdTech sector is seeing a lot of M&A deals | Jobi Cool

The Indian EdTech sector has seen a spate of mergers and acquisitions (M&A) – 37 in total – since January this year, as consolidation takes hold in the industry.

In the latest deals, Vedantu will buy Deeksha for $40 million and Veranda Learning Solutions will buy JK Shah Education for $41 million. The total value of the contracts was not available as most companies do not disclose the figures.

Reports say that India has over 4,500 EdTech startups helping over 300 million school students.

Data from Chennai-based Venture Intelligence says 32 of the deals this year were domestic deals, while two were outbound and three inbound. Great Learning’s acquisition of Northwest Executive Learning for $100 million was the highest valued acquisition.

According to the PwC India Startup Deals Tracker report, EdTech saw seven M&As in the September quarter. upGrad was the top acquirer in the quarter with four acquisitions – Wolves India, Harappa Education, Exampur and Centum Learning.

Managing Director and CEO – Venture Intelligence, Arun Natrajan, says post-Covid, the reopening of gyms has impacted the sector. With the decline in the financing of smaller companies, consolidation has begun, where stronger and better-financed parties emerge as takeover parties. Another factor driving M&A activity is the need for EdTech companies to shift to the hybrid (versus online-only) model, he added.

Agreeing with Natarajan, Atul Saraogi, director, Veda Corporate Advisors Pvt Ltd, said that consolidation is accelerating on the demand side, with both digital and large offline companies looking for size through inorganic means. On the supply side, there are a number of startups that cannot attract capital, as well as solid traditional offline companies.

Neeti Sharma, president and co-founder of Teamlease Edtech Ltd, said the acquisitions focus on providing skill-based learning to ensure students are employable and job-ready. CA/CS coaching helps students build their career in a particular field and gives them the knowledge and experience to perform well in their workplace.

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