The Orchids International School network operated by K12 Techno, and Unacademy are in talks to unite. This would be the first significant consolidation in the edtech sector, which has been suffering from a lack of investment for the previous two years. Through a mix of its own brand, curriculum, and technology platform, K12 Techno offers full stack education, content, and technology services to over 900 educational institutions nationwide.
As per sources, the two companies have been discussing the terms of the merger for the last four weeks. If the merger gets through, both companies will own 50% each in the joint entity.
Unacademy made an investment in Orchid School (K12 Techno) three years ago, and Peak XV is a common investor in both companies. Sources assert that Unacademy also wanted to acquire Orchid School in 2021, but the discussions didn’t materialize.
K12 Techno provides management services to ICSE and CBSE curriculum schools from kindergarten to class X-XII, based in metros like Bengaluru, Mumbai, Gurugram and many mid-sized cities under the ‘Orchid’ brand.
According to startup data intelligence platform TheKredible, K12 Techno registered Rs 382 crore in revenue in FY23 with Rs 39 crore loss. The firm expected to close FY24 with Rs 450 crore with EBITDA of nearly Rs 100 crore.
Recently, Venturi Partners purchased a $27 million worth stake in K12 Techno Services from Navneet Learning LLP, subsidiary of Navneet Education Limited.
Softbank-backed Unacademy raised its last equity round of $440 million led by Temasek at a valuation of $3.44 billion in August 2021. During fiscal year FY23, Unacademy saw a 26% jump in its operating revenue to Rs 907 crore while controlling losses by nearly 40% to Rs 1,004 core. In the beginning of FY24, the company also claimed that it was close to profitability at the group level.
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