Mumbai-based edtech unicorn on Friday said it has entered into an agreement with London-headquartered learning firm Pearson to acquire the latter’s local K-12 learning business in India.
The acquisition is funded through a combination of new fundraise and internal accruals. Additional terms of the current transaction were not disclosed.
With this acquisition, LEAD will immediately expand its reach to over 9,000 schools, it said, adding that the firm will further enhance its product portfolio to cater to the entire spectrum of over five lakh private schools in India.
In its K-12 learning portfolio, Pearson India caters to private, English medium CBSE and ICSE schools offering blended learning solutions and teacher resources.
“School edtech is poised for sustained growth post-COVID, and with the acquisition of the local K-12 learning business of Pearson India, we will be able to reach more schools and students in the service of our mission to provide excellent education to every child,” Sumeet Mehta, Co-founder and CEO of LEAD, said.
“This acquisition will unlock synergies and build on our combined knowledge, experience, and technology strengths to bring 21st-century school edtech innovation to India’s schools,” he added.
Pearson serves customers in nearly 200 countries with digital content, assessments, qualifications, and data. While LEAD provides software, hardware curriculum, books, school kits, and training sessions through its integrated school system.
The acquisition, approved by the Board of Directors of both companies, is subject to customary closing conditions and is expected to be completed by Q1 CY 2023.
The development comes at a time when edtech unicorns are witnessing losses, laying off employees, slowing expansion plans, and trying to burn as little cash as possible amid a funding winter.
LEAD has raised a total funding of $170 million over seven rounds, according to Tracxn. Last month, the startup raised $4.2 million in a debt round from Alteria Capital. Earlier in 2022, the edtech company raised $100 million in a Series E funding round led by WestBridge Capital and GSV Ventures at a valuation of $1.1 billion.
After joining the unicorn club in January 2022, it announced an employee stock ownership plan (ESOP) liquidation plan of nearly $3 million for its employees. But like many other edtech companies, LEAD also laid off 80-90 employees in August 2022 to cut costs.
LEAD reported a net loss of Rs 397.1 crore in FY22 compared to Rs 126.1 crore in the year-ago period. Its revenue more than doubled to Rs 133.2 crore in FY22 from Rs 57.1 crore in FY21.
