Edtech giant UpGrad is reportedly in advanced discussions to acquire Unacademy, a prominent test-preparation platform, in a deal valued between $300 million and $400 million (₹2,800–₹3,500 crore). This potential acquisition, if finalized, would signify a substantial drop in Unacademy’s valuation from its peak of $3.44 billion in 2021, reflecting the significant cooling of India’s once-booming pandemic-era edtech sector. Sources close to the matter indicate that a term sheet could be signed within three weeks, marking one of the largest consolidation moves in India’s edtech space this year.

As part of the proposed transaction, Unacademy’s language-learning application, AirLearn, is slated to be spun out and established as a separate entity. The core test-preparation business of Unacademy, which includes its expanding network of offline learning centers, will be sold to UpGrad. UpGrad will not hold any equity in the newly independent AirLearn.

Unacademy has made significant strides in improving its financial health, drastically reducing its annual cash burn from over ₹1,000 crore at its peak to approximately ₹100 crore currently. The company also boasts healthy cash reserves of around ₹1,200 crore, making it a more attractive and stable acquisition target for UpGrad.

Founded in 2015 by Gaurav Munjal, Roman Saini, and Hemesh Singh, Unacademy rose to unicorn status during the pandemic, backed by major investors such as General Atlantic, SoftBank, and Temasek. Temasek, Singapore’s state investment firm, holds stakes in both companies, having led Unacademy’s $440 million Series H round in August 2021 and invested $120 million in UpGrad in 2021, followed by an additional $60 million in 2024. Unacademy, headquartered in Bengaluru, India, started as a YouTube channel and grew into one of India’s largest online learning platforms, offering live and recorded classes for competitive exams like UPSC, JEE, NEET, CAT, and banking exams. It has since expanded into offline coaching centers and various other verticals, including AirLearn.

UpGrad, founded in 2015 by Ronnie Screwvala, Mayank Kumar, Phalgun Komandur, and Ravijot Chugh, is headquartered in Mumbai, India. Its primary focus is on higher education, professional learning, and career upskilling. UpGrad partners with global universities and industry leaders to provide online degree programs, MBA courses, and professional certifications in fields such as data science, business, technology, and management. It targets working professionals and college graduates seeking to enhance their skills or advance their careers. Key investors in UpGrad include Temasek, IIFL, and International Finance Corporation (IFC).