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The Competition Commission Of India (CCI) has approved Manipal Group’s proposal to acquire a stake in Aakash Educational Services from the coaching chain’s founder JC Chaudhry.

“… CCI has approved the combination involving acquisition in Aakash Educational Services Limited by Manipal Health Systems Private Limited and Manipal Education and Medical Group India Private Limited,” the watchdog said in a statement.

Chaudhry owns a minority stake in Aakash after selling a significant portion of his shares to the Manipal Group earlier.

Ranjan Pai, who leads the Manipal Group, is one of the largest shareholders in Aakash with about 40% stake. Aakash was owned by BYJU’s, which is facing insolvency proceedings.

In November 2023, Pai stepped into BYJU’S quagmire and paid off $170 Mn debt that BYJU’S owed to a US lender. This freed up 27% of Aakash’s shares that were held as collateral. In total, Pai invested $300 Mn in Aakash, and in January 2024, this investment was converted into equity, giving him a total 40% stake.

The deal made Aakash debt-free and put Pai in the driver’s seat at the coaching chain.

Interestingly, the CCI approval comes at a time when Aakash is looking to raise fresh funds. However, the National Company Law Tribunal (NCLT) has paused any changes to the test prep chain’s shareholding or articles of association (AoA).

Aakash is seeking to raise INR 500 Cr to cover operating costs for its network of offline coaching centres. The proposed fundraise will require changes to the company’s AoA, which is being opposed by the resolution professional (RP) of BYJU’S.

BYJU’S has warned that the changes would further reduce its ownership in the company at a time when it is undergoing insolvency proceedings. During an NCLT hearing on April 30, BYJU’S counsel Abhinav Vasisht reportedly argued that the company’s stake was being diluted despite the tribunal’s directions. He also raised concerns over hypothecation of Aakash’s assets and alterations to the AoA.

Earlier this month, the National Company Law Appellate Tribunal (NCLAT) rejected an appeal from BYJU’S challenging the NCLT’s consent order.

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