The Nightcap from SPAC Track

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The online education provider Byju’s, India’s most valuable startup, is in advanced discussions to go public through a merger with one of Churchill Capital’s special-purpose acquisition companies, according to people familiar with the matter. 

The startup held talks with several potential SPAC partners and is farthest along in working out an agreement with Michael Klein’s Churchill Capital, said the people, asking not to be named discussing private matters. Churchill Capital VII (CVII) raised more than $1.3 billion in an offering in February and trades on the New York Stock Exchange. 

Under the preliminary terms discussed, Byju’s would raise a total of about $4 billion and seek a valuation of about $48 billion, the people said. The startup was valued at $21 billion, according to market research firm CB Insights. 

While an announcement could come as soon as January, the negotiations are not final. Byju’s or Churchill could still opt out of such a deal, and Byju’s could consider an IPO in India next year, the people said. 

The startup had earlier discussed a SPAC merger with Michael Dell’s MSD Acquisition Corp. (MSDA) and Altimeter Capital Management, one of the people said. India-headquartered companies can’t go public through conventional intitial public offerings in the U.S. under the country’s current regulations.

Byju’s declined to comment. Churchill didn’t immediately respond to requests for comment.

The Bangalore-headquartered company, founded and led by former teacher Byju Raveendran, provides K-12 lessons and video material to millions of Indians studying for the country’s competitive engineering and medical entrance exams. It also provides one-to-one coding, math and reading classes and material to students in countries in North America, the Middle East and Latin America.