Latest adjustment in Prosus’ fair value ( FMV) for an almost 10% stake in Byju’s to $493 million as of March 2023 would translate to an enterprise valuation about $5.1 billion, against $22 billion when the edtech company last raised an equity funding.
Blackrock, another investor in Byju’s, had recently marked down its holding to a valuation of about $8.5 billion.
Late last year, Prosus had said it had ceased equity accounting of Byju’s as it lost “significant influence” over the firm as its holding slipped below 10%.
“In September 2022, the group lost significant influence in Byju’s as it no longer exerts significant influence over the financial and operating policies of the entity. The group recognised a gain on disposal of the associate of $22 million, including a reclassification of the accumulated foreign currency translation losses of $55 million,” Prosus had said in a filing released in November.
Prosus has invested a total of $578 million in the edtech firm.
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News publication The Arc first reported about Prosus marking down Byju’s valuation.An email sent to Byju’s did not elicit a response on the matter.
For ZestMoney, Prosus has marked its investment in Primrose Hill (ZestMoney) to zero as against $38 million FY22.
ZestMoney was in talks with PhonePe for an acquisition, but the deal fell through due to concerns over diligence, as reported first by ET.
When contacted, Mandar Satpute, chief banking officer of ZestMoney, said, “Our shareholders and investors continue to remain positive about the business and fund us to profitability and onward. We continue to work with PayU (owned by Prosus) on multiple fronts… We cannot comment on their reasons. It is their prerogative.”
Satpute was one of the leaders appointed to take charge of ZestMoney after the founders stepped back from their operating roles.
Prosus, an investor in Urban Company–has kept the fair value of its investment in the at-home services firm at $84 million while it has slightly increased the same for ecommerce brand aggregator Mensa Brands at $27 million as of March 2023 compared to $25 million a year ago.
Global investors – through funds managed by them – have been readjusting valuations of their portfolio firms where large startups like Swiggy, PharmEasy and others have also seen similar markdowns in recent weeks.
Last month, Invesco, an existing investor in Swiggy, slashed the food-delivery firm’s valuation by 33% to $5.5 billion from $8.2 billion. Similarly, New York-based investment management firm Neuberger Berman has marked down the valuation of the shares in online pharmacy PharmEasy’s parent API Holdings by 21%, to $4.4 billion, ET reported on May 11.
Byju’s is in the middle of a series of troubles. Its investor board members Peak XV Partners, Prosus and Chan Zuckerberg Initiative have left the board while the edtech firm is battling with its creditors in court over an accelerated payment demand for the $1.2 billion term loan B it took in November 2021. The company continues to cut jobs to save costs and last week undertook fresh layoffs which would impact up to 1,000 jobs, ET had reported.