Unacademy had around ₹900 crore in cash, a topline of about ₹400 crore and, according to co-founder and CEO Gaurav Munjal, most of its businesses were profitable or close to profitability.
Yet on September 1, it completed a sale to rival upGrad in a deal valued at ₹1,955 crore, or about $206 million.
So why sell when the company says it had the option to continue independently? Munjal’s own explanation points to a strategic choice rather than a need for immediate cash.
Unacademy Was Not Forced To Sell
Munjal has been explicit that Unacademy was not compelled to find a buyer.
In a post announcing the completion of the transaction, he said the company had “every option to keep going independently” and that “nobody was forcing this.” He pointed to its roughly ₹900 crore cash balance, around ₹400 crore topline and the fact that most of its businesses were profitable or near-profitable.
That makes the financial position an important part of understanding the transaction. The sale cannot simply be described as Unacademy needing capital to keep operating. The decision, based on Munjal’s public explanation, was about what the company could build next.
Munjal Chose A Different Path
Munjal said the deciding factor was the opportunity he saw in combining with Ronnie Screwvala’s upGrad.
He said he had met Screwvala several times over the years and was impressed by what he had built in higher education, as well as his vision for education in India and beyond. According to Munjal, the more the two sides worked on the combination, the clearer it became that it could be “a better path for the ecosystem.”
Munjal also offered a more personal explanation for choosing the deal. He said founders can sometimes be drawn towards a path that is more exciting than one that makes more money.
That is important context for the transaction. Munjal is not presenting the acquisition as an emergency exit. He is describing it as a choice between continuing independently and pursuing what he believes could be a larger opportunity with upGrad.
Why UpGrad Made Sense
The two companies also bring different parts of education into the same group.
Unacademy has a major presence in online learning and test preparation, while upGrad has built businesses around higher education, professional learning and skilling. The acquisition gives upGrad an entry into online test preparation, according to The Economic Times.
The transaction also brings Unacademy’s other businesses into the upGrad group. Unacademy shareholders are receiving upGrad shares under the 100% share-swap structure, rather than a straightforward cash payment for their holdings. Angel investors were cashed out at closing, according to Screwvala.
Munjal will continue as Unacademy’s CEO, meaning the acquired company is not simply disappearing into the upGrad brand immediately.
Unacademy & UpGrad Deal Took Months
The decision also came after an on-and-off negotiation.
Unacademy and upGrad began discussions in November 2025, but the talks were called off in January 2026 after the companies failed to agree on valuation. They revived negotiations in March and signed a term sheet for the 100% share-swap transaction. The Competition Commission of India cleared the merger on July 7, before the deal formally closed on September 1.
The final transaction value was fixed at ₹1,955 crore, according to The Economic Times. That was substantially below Unacademy’s $3.44 billion peak valuation in 2021.
Munjal himself acknowledged the contrast, saying Unacademy had “raised at a peak, but sold at a fraction” and that he was not going to dress up those facts.
Why Unacademy Sold
The evidence available from the company points to a straightforward answer.
Unacademy sold because Munjal and the company believed combining with upGrad offered a more compelling path than continuing independently.
That conclusion comes directly from Munjal’s explanation. He has said Unacademy had the cash and the option to remain independent, but believed the combination could be better for the ecosystem and its shareholders.
The valuation decline is an important part of Unacademy’s story, but it does not, by itself, explain why the company agreed to the deal.
The more immediate reason is the one Munjal has put on record, Unacademy chose the upGrad combination because it believed the combined path was more ambitious than going it alone.
Whether that decision ultimately creates more value for Unacademy’s shareholders will depend on how the combined business performs from here.
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