T
he Competition Commission of India (CCI) has cleared the acquisition of Unacademy by upGrad, thereby overcoming the last regulatory hurdle in what is expected to be one of the largest deals seen recently in the edtech industry, where two of the biggest edtech unicorns will be brought under one umbrella.
As per the regulator's July 7 notification, it has granted the proposed acquisition of Sorting Hat Technologies Private Limited, an entity of Unacademy, by upGrad Education Private Limited under Section 31(1) of the Competition Act, 2002. In addition to this, it has stated that the order in detail would be issued later. This comes around two months after upGrad had filed the application for this clearance.
The green signal from CCI involves the acquisition of a stake by upGrad in Sorting Hat Technologies, followed by the merger of the entity into upGrad Education. In other words, the Unacademy brand will no longer continue as an independent company but will be merged into upGrad.
This is not a cash deal but a stock swap deal. The deal is estimated to be valued at Rs 2,055 crore ($218 million). Unacademy is being sold at a hefty discount, with the firm’s value being only one-ninth of the value it had reached at the peak of its valuations in 2021, which was at $3.4 billion.
But this acquisition didn’t just pop into existence all of a sudden; it was preceded by quite an odyssey:
- 2024 – Unacademy considered a sale to Allen Career Institute in Kota over disputes about valuation.
- January 2026 – upGrad and Unacademy halted negotiations regarding a merger due to disagreements on how high the latter should be valued. It appears that upGrad wanted to sell itself at the valuation of $2.25 billion, whereas Unacademy’s valuation dropped to between $300 million and $400 million.
- March 2026 – Negotiations started anew with the signing of a term sheet. Unacademy co-founder and CEO Gaurav Munjal confirmed this development and said that he would continue working with the company after the merger is completed.
- April 2026 – The acquisition was officially announced by upGrad.
- May 2026 – upGrad submitted a merger application to CCI.
- July 7, 2026 – The approval from the CCI came through.
The rough path taken demonstrates that, generally speaking, this story is about the fall of Unacademy after the edtech boom brought about by the pandemic became less relevant.
upGrad was founded in 2015 by Ronnie Screwvala and made a brand out of higher education, professional skill development, and admission consultancy to colleges abroad. UpGrad never ventured into one particular lucrative market that is preparing for competitive exams through online test preparation, like NEET, JEE, UPSC, and CAT.
This is precisely what Unacademy specializes in. Established by Munjal, Hemesh Singh, and Roman Saini in 2010, Unacademy began its journey as a YouTube channel for education before evolving into a proper learning portal by 2015.
Through the acquisition of Unacademy, upGrad immediately gains access to:
An area of expertise that is not currently covered by the company—test preparation and K-12 exam coaching services.
An established consumer base that has great brand awareness when it comes to exam preparation.
Other verticals offered by Unacademy such as its new AI-powered learning services. As per Screwvala, he is particularly interested in Airlearn, an AI-based product that is getting global traction.
upGrad is no stranger to acquisitions. In the past year alone, the firm has acquired several firms as part of its aggressive inorganic growth strategy, which includes the popular internships and careers website Internshala. This is, by far, the biggest of all those acquisitions.
The downfall of Unacademy has been well documented in stories of failed education technology companies before. The company had to undergo a brutal correction after having burnt through an alleged sum close to Rs 1,400 crore in 2022 while scaling up aggressively the previous year.
In fact, as per Munjal, CEO of Unacademy, the company had reduced its burn to under Rs 175 crore by 2025 by cutting costs and revamping its offline coaching center business.
However, according to information shared with his employees recently, Munjal had announced that the company would transform its offline business to a franchisee model, which will become light on assets and capital expenditure, enabling it to invest further into its online business, which has piqued the interest of a prospective buyer like upGrad.
Unacademy was even trying to sell itself to K-12 Techno Services and PhysicsWallah, but both attempts fell through.
This is said to be the first-ever merger of two Indian edtech unicorns, coming at a time when there is a need for a shot of confidence injection in the sector.
Edtech in India has not been able to attract investors for many years now. As per Inc42's Annual Indian Startup Trends Report, edtech attracted only $249 million, which was the lowest in eight years. It is a drop of 56% from $572 million in the previous year.
The collapse of BYJU'S, which destroyed investor confidence in the entire edtech category, played a major role here. Along with that, there is a mandated funding period around back to school and an inability of edtech startups to compete with the learning process driven by artificial intelligence.
Against this backdrop, the upGrad-Unacademy merger can be seen as a trend in the sector wherein bigger and financially stable edtech players have been gobbling up the smaller players instead of any new unicorn coming into existence through the normal course of events.
With the approval from the CCI, the deal will now be on track for closing with the regulatory approval order and closing steps typical of a merger of this scale. As it stands, the numbers for upGrad have already started looking quite positive—with the company making profits of Rs 38 crore out of Rs 1,532 crore of provisional income within the first eleven months of the financial year 2026.
Having the users and test preparation capabilities of Unacademy will give upGrad the true reach in the Indian educational sector ranging from professionals to those preparing for exams.
