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upGrad has signed a term sheet to acquire rival Unacademy in an all-stock deal, bringing two of India’s biggest edtech players under one umbrella.
The breakdown: the proposed deal will be structured as a 100% share swap, meaning no cash changes hands, Unacademy’s shareholders will receive upGrad shares instead. The final valuation will be disclosed only after regulatory filings and deal closure.
Earlier talks between the two companies had stalled over valuation differences. Initial discussions had valued Unacademy at around $300 million, a sharp fall from its $3.4 billion peak valuation during the edtech boom.
Under the proposed structure, Unacademy co-founder Gaurav Munjal will continue as CEO, focusing on building online learning products while operating within the combined ecosystem.
Background: over the past year, Unacademy has been restructuring its business.
The company has consolidated its offline centres through franchise partners, completed a ₹50 crore ESOP buyback, and expanded its language-learning app Airlearn, which is gaining users in markets like the US, UK, Germany, and Canada. It also currently holds over $100 million in cash reserves.
For upGrad, the acquisition strengthens its push to build a full-stack learning platform. The companies have also included a break fee clause, meaning penalties may apply if the deal fails to close.
Deeper analysis: India’s edtech sector has gone through a dramatic cycle. During the pandemic, startups raised billions as online learning exploded. But once schools reopened, demand cooled sharply.
Funding into Indian edtech startups fell from over $4 billion in 2021 to less than $500 million in 2024, forcing companies to cut costs, shut offline centres, and rethink growth.
Despite the slowdown, the country has over 250 million students, one of the world’s largest education markets.
The country’s online education market is projected to reach $30–35 billion by 2030, driven by demand for test prep, upskilling, and global learning platforms.
Deals like upGrad–Unacademy suggest the sector may be entering a consolidation phase, where stronger players acquire struggling rivals to build scale and sustainable business models.
