upGrad is set to acquire Unacademy in an all-stock deal valued at Rs 1,955 crore, marking one of the largest consolidations in India’s edtech sector post-pandemic. The transaction, cleared by the Competition Commission of India (CCI) on 7 July 2026, is expected to close by mid-August subject to remaining approvals and customary conditions.
Deal structure, valuation reset, and governance
Under the agreement, upGrad will acquire 100% of Unacademy through a share swap. The final consideration of Rs 1,955 crore is marginally below earlier indications of Rs 2,055 crore and implies a steep reset from Unacademy’s 2021 peak valuation of approximately $3.44 billion, reflecting broader market corrections in edtech. The pact includes a break-fee provision to safeguard deal certainty.
Post-closing, Unacademy’s investor group will receive one seat on upGrad’s board. Co-founder Gaurav Munjal will continue as Unacademy’s CEO, with a remit to scale AI-led education products within the combined entity.
Portfolio integration and AI-led growth
The transaction brings Airlearn—Unacademy’s AI-driven language learning unit—under upGrad. Earlier plans to spin off Airlearn have been shelved; the platform has reported rapid scale-up, with annual recurring revenue rising from roughly $200,000 to nearly $3 million by end-2025, according to company disclosures.
upGrad will consolidate multiple businesses in Bengaluru, moving PrepLadder’s headquarters from Chandigarh to join Unacademy, Airlearn, and Graphy. The integration aims to streamline operations, centralise product and engineering, and accelerate go-to-market execution in test prep, professional upskilling, and language learning.
Shift in offline strategy
Unacademy will exit company-operated offline coaching centres and pivot to a franchise-led model. The shift follows a focus on cost rationalisation, as offline centres had been a significant expense driver. Management expects the franchise approach to reduce capital intensity while preserving reach in key test-prep markets.
Financial trajectory of both companies
Unacademy has sharply curtailed cash burn from nearly Rs 1,400 crore in 2022 to an estimated Rs 150–200 crore across 2024 and 2025. While FY25 revenue moderated to Rs 826.3 crore, tighter spending narrowed losses. The company reportedly had about Rs 1,100 crore in cash on hand ahead of the merger.
upGrad, meanwhile, reported a provisional EBITDA profit of Rs 38.8 crore on revenue of Rs 1,531.7 crore in the first eleven months of FY26, signalling improving operating leverage across its higher-education and lifelong learning portfolio.
Student protests and employee concerns
The consolidation comes amid scrutiny of Unacademy’s recent operational decisions. The company faced pushback from employees after changes to its ESOP exercise timelines. It later rolled out a Rs 50 crore ESOP buyback programme, with reported payouts ranging from over Rs 10 lakh to upwards of Rs 1 crore for eligible staff.
Separately, the closure of company-run offline centres has triggered protests, notably among UPSC aspirants at the Karol Bagh centre in Delhi. Students allege that two-year courses priced up to Rs 1.8 lakh were curtailed before completion, with learning shifted to recorded online classes. Some also claim refunds were denied despite earlier indications of eligibility and that they were asked to sign waivers before any refund processing.
Protesters further alleged they were confined during a sit-in and that bouncers, rather than senior management, engaged with them—claims that have intensified concerns about the transition away from offline delivery. The companies have not publicly detailed individual redress mechanisms for affected students.
What the merger signals for edtech
The deal underscores a new phase for India’s edtech market: consolidation, disciplined cost structures, and a pivot towards AI-powered learning solutions. For the combined entity, immediate priorities include integrating product stacks, stabilising learner experience during the offline-to-franchise shift, and addressing student grievances to restore confidence in key test-prep cohorts.
