Ronnie Screwvala’s higher-skilling company Upgrad has withdrawn itself from talks to acquire SoftBank-backed test prep startup Unacademy, people familiar with the matter said. The discussions stalled due to differing valuation expectations between the two sides, they added.
“The deal talks were officially called off today. The two sides couldn’t align on the final number for the valuation,” one of the persons said.
Confirming the development, Screwvala told ET, “Yes, we are not proceeding as we could not agree on valuation of Unacademy”.
Initially, the talks had happened for an all-stock transaction that valued Unacademy around $300 million – an over 90% cut from its peak valuation of $3.4 billion.
“Upgrad was valuing itself at around $2 billion, a level that would have implied nearly 15% dilution as per the initial terms…and this structure did not work for the company,” one of the people cited above said.
Unacademy founder Gaurav Munjal did not comment.