upGrad has dropped plans to accumulate Unacademy after months of discussions, as the 2 sides did not agree on a last valuation, in accordance with media experiences.

The talks had marked the primary formal affirmation of potential merger and acquisition discussions round Unacademy. Final month, co-founder Gaurav Munjal mentioned the corporate was open to an M&A transaction if it resulted in a “stronger entity”. He additionally acknowledged that Unacademy’s valuation might have fallen to beneath $500 million, sharply decrease than its peak valuation of $3.5 billion in 2021.

As a part of the discussions with upGrad, Unacademy’s buyers have been anticipated to obtain a minority stake within the mixed entity. upGrad, which sees itself at a valuation of round $2 billion, was primarily concerned with Unacademy’s core test-preparation enterprise, with different verticals prone to be excluded from the deal construction.

The collapse of the talks comes in opposition to the backdrop of a protracted slowdown in India’s edtech sector after the pandemic-driven growth. Over the previous 18 months, Unacademy has been reported to be in acquisition discussions with a number of gamers, together with Okay-12 Techno Providers, Allen and upGrad.

In December 2024, Allen was reported to be in talks to accumulate Unacademy for about $800 million, a improvement Munjal had then publicly dismissed as hypothesis.

The newest end result underscores the sharp reset in edtech valuations and deal expectations. Unacademy, backed by buyers similar to Tiger International, Peak XV Companions, SoftBank, WaterBridge Ventures and Meta, has been restructuring its operations and narrowing its focus as funding circumstances tightened. upGrad, in the meantime, continues to pursue development independently in a extra cautious capital atmosphere.

With the acquisition talks now off the desk, each corporations are anticipated to chart their subsequent section individually in a sector that continues to be beneath stress from slowing demand, consolidation, and elevated scrutiny of enterprise fashions.