Manipal Group Chairman Dr Ranjan Pai is in early talks to invest in Byju’s owned Aakash, through his family office, according to a source close to the development.

This investment will be a part of the equity round that the company is looking to raise, added the source. Byju Raveendran, who holds a 30 per cent stake in Aakash, is expected to partially offload his stake to Pai.

Additionally, the funds raised is expected to be used to repay the ₹800 crore due to investor Davidson Kempner after Byju’s had a technical default on the loan it raised in May. Raveendran is also looking to release the pledge on shares of Aakash, which were provided as collateral for the loan.

Neither Byju’s nor Ranjan Pai’s office commented on the likely investment. Pai was an early investor in Byju’s in 2011 through Aarin Capital, but is believed to have exited majority of the original investment at a significant profit after a few years.

In May, Byju’s signed a definitive agreement with Davidson Kempner to raise $250 million in structured instruments, linked with future cash flows of Aakash Educational Services. However, less than half of the fund was released as some loan agreement covenants were not met.

In 2021, the edtech unicorn had acquired Aakash Educational Services for nearly $940 million in a cash and stock deal. It was a 70:30 cash-equity deal, under which the promoters of Aakash and Blackstone would receive an undisclosed stake in Byju’s for 30 per cent of the payment.

However, Aakash shareholders have been reluctant to execute the share swap due to Byju’s declining value, the source said.

Meanwhile, Think and Learn Pvt Ltd, parent company of Byju’s, has sent a legal notice to founders of Aakash following their alleged resistance to complete a share swap that was unconditionally agreed as part of the sale, according to an agency news report.

The shareholders of Aakash had written to the beleaguered edtech firm declining to comply with the notice sent by the firm in March to execute the share-swap deal, the report added.

“If the issue is not resolved amicably, it may lead to court proceedings, and the outcome could affect the companies’ operations, relationship with shareholders, and market reputation,” said Sonam Chandwani, Managing Partner, KS Legal & Associates.