Think & Learn Pvt Ltd (TLPL), the parent of edtech firm Byju’s, is planning to raise $200 million through a rights issue that values the company at less than $250 million, post issue — a far cry from its peak valuation of $22 billion in March 2022.

“The board of TLPL today (Monday) launched the raising of funds $200 million by way of a rights issue to all its equity shareholders to support its ongoing efforts to drive growth and achieve operational sustainability,” the beleaguered firm said in a statement.

It is learnt the low valuation is only for this portion of the issue which is expected to close by the end of February.

Sources said that the actual valuation is much more than $ 200-250 million; the rights issue may have been priced lower to attract all the existing investors.

Most current investors including founder Byju Raveendran are expected to subscribe to the issue.

Earlier this month, Blackrock an early investor in Byju’s lowered its valuation to less than $1 billion.

The company will use the proceeds to fund its ongoing capital expenditure plans and for general corporate purposes.

“As the largest shareholders, the founders of Byju’s have already demonstrated their commitment to the company by personally investing more than $1.1 billion in the last 18 months,” the company statement said.

Ahead of the rights issue, Raveendran wrote a letter to shareholders informing them about the offerings.

“We believe an expeditious capital raise will provide the company with the resources it needs to rebuild and scale. This shall be used for the continuation of business operations, to manage obligations and to make the company more sustainable,” Raveendran added.

“This capital raise is essential to prevent any further value impairment and to equip the company with the necessary resources to deliver on its mission. It has been 21 months since our last external capital raise, during which we have cut our burn and worked to become a lean organisation,” he said.

The company is now less than a quarter away from achieving operational profitability, reflecting the effectiveness of the company’s strategic initiatives and the resilience of its business model, he said.

Byju’s recently declared its financial results after a delay of about 22 months in which it reported a widening of operational loss to Rs 6,679 crore in 2021-22, mainly due to losses incurred by subsidiaries White Hat Jr and Osmo.

The company has posted an operational loss (EBITDA) of Rs 4,143 crore in 2020-21. Its revenue more than doubled to Rs 5,298.43 crore in 2021-22 from Rs 2,428.39 crore in the previous fiscal.