The Coursera-Udemy Merger: Two Years in the Making, Third Time Lucky

Both Coursera and Udemy started 2025 with new CEOs. Greg Hart took over at Coursera in February. Hugo Sarrazin started at Udemy in March. Less than a month into the job, both CEOs were in conversations to sell their companies.

On April 8, Hart and Sarrazin met for the first time at ASU+GSV. The rest, as they say, is history.

In my 5,000-word analysis of Coursera’s acquisition of Udemy, I called the deal rushed. Two new CEOs, both less than a year into the job, merging two public companies. I was right about that. But I was wrong about it being sudden.

This deal was two years in the making. Coursera approached Udemy three times before getting a yes. The first attempt was almost exactly two years ago. On April 9, shareholders of both companies will vote on the merger.

I found all of this in the prospectus Coursera and Udemy filed last month. Buried in 300+ pages of dense language: failed merger attempts, competing bidders, and a rogue shareholder.

And every time the two companies came back to the table, the deal got worse. I’ll break down all of it.

1. First Contact Between Coursera and Udemy
2. Coursera’s First Attempt
3. The $2 Billion Cash Offer Udemy Rejected
4. Someone Tried to Buy Coursera for $1.8 Billion
5. Coursera’s Second Attempt
6. Coursera’s Third Attempt
7. The Shrinking Deal: $3.8B to $1.7B

First Contact Between Coursera and Udemy

On September 19, 2023, Coursera and Udemy signed a mutual confidentiality agreement and “held preliminary discussions regarding a potential commercial partnership.” Not a merger. Just a partnership, probably similar to a marketing experiment Udemy had run with Emeritus. Nothing came of it. But the door was open.

Five months later, in late February 2024, the conversations shifted to “a potential strategic transaction.” By March, Udemy’s Board had formed a strategic committee. By April, they’d hired Morgan Stanley.

On April 8, 2024, Coursera’s then-CEO Jeff Maggioncalda delivered the first formal offer to Udemy’s then-CEO Greg Brown. Also on April 8, a private equity firm made its own unsolicited offer for Udemy.

Udemy suddenly had two suitors at the door.

Coursera’s First Attempt

Coursera’s opening offer on April 8 was an all-stock deal. Coursera’s CEO would lead the combined company. Udemy’s CEO would become president. And Coursera wanted exclusive negotiations. Udemy said no.

After a day of back-and-forth, they settled on an exchange ratio of 0.875, giving Udemy shareholders 46% of the combined company. Udemy signed an exclusivity agreement, set to expire April 29.

But as both companies shared their financial outlooks during due diligence, the Udemy Board grew concerned about upcoming earnings. On April 23, they killed the talks.

Six days later, Coursera proved them right. I covered it at the time: “Coursera Growth Stalls, Leadership Changes as Stock Hits All-Time Low.” On the day Coursera made its offer, its market cap was $2.12 billion.

A week after the talks collapsed, Udemy was the larger company.

The $2 Billion Cash Offer Udemy Rejected

On the same day Coursera made its offer, a private equity firm the prospectus calls “Party A” showed up with its own unsolicited bid. Party A offered to buy Udemy outright in an all-cash deal at $13 to $14 per share. At the time, that would have valued Udemy at roughly $1.9 billion.

Party A owned a company in the same space and wanted to combine it with Udemy.

The Udemy Board considered both offers and chose Coursera, believing 46% of a larger combined company was more valuable than Party A’s cash. But after the Coursera talks collapsed, Udemy went looking.

Morgan Stanley contacted eight potential buyers. Only Party A submitted a proposal. The rest walked away, citing “concern regarding trends in the education industry, particularly in light of the potential disruptive impact of AI.”

Over the next two months, Party A made two more offers. Meanwhile, Udemy’s stock kept falling.

Party A’s offers stayed roughly flat while Udemy’s stock kept sinking. By June, Party A’s $13.50 was a 59% premium over the market price. The Udemy Board countered at $14.70.

Party A walked away. From the prospectus: “Party A responded that it no longer had the opportunity for synergies with the portfolio company that it had previously anticipated.” And then: “Soon thereafter, it was publicly disclosed that Party A was no longer invested in the company that presented potential synergies with Udemy’s business.”

That portfolio company was almost certainly Pluralsight, the enterprise learning platform. The private equity firm was almost certainly Vista Equity Partners. Vista had acquired Pluralsight in a $3.5 billion take-private deal in 2022. By May 2024, Vista had written off its entire investment.

On June 20, with no other bidders and Party A gone, the Udemy Board terminated the strategic review. $13.50 per share in cash was the best offer Udemy shareholders would see.

Someone Tried to Buy Coursera for $1.8 Billion

One of the more surprising revelations in the prospectus: Coursera was seriously considering selling itself. These companies project optimism in public. In private, the sentiment is quite different.

Coursera’s Board pushed out its CEO and brought in Greg Hart while acquisition talks were already underway. The company called it a retirement.

But that’s why you read the filings.

In January 2025, the lead independent director of a publicly listed company the prospectus calls “Party 1” contacted Coursera’s lead independent director, Scott Sandell, about acquiring Coursera. Days later, on January 29, Coursera announced that Jeff Maggioncalda was out, replaced by Amazon veteran Greg Hart.

Over the next few months, the two sides held multiple calls and met in person. The Coursera Board weighed the approach across multiple meetings against another option: re-engaging with Udemy.

On June 3, Party 1 made a formal offer: $9.50 to $10.00 per share, with 60% in cash and 40% in Party 1’s stock. Coursera was trading around $8 at the time, with a market cap of $1.47 billion. At the top of the range, Party 1’s offer valued Coursera at roughly $1.8 billion.

Coursera chose Udemy, believing that “a transaction with Udemy was expected to provide a greater benefit to the Coursera Stockholders.”

By June 23, Coursera had cut off discussions with Party 1 entirely. The prospectus doesn’t reveal who Party 1 is. But the clues narrow it down: a publicly traded company, large enough to buy Coursera in a mostly-cash deal, with a strategic interest in online education.

Coursera’s Second Attempt

On March 12, 2025, Udemy replaced its CEO with McKinsey veteran Hugo Sarrazin. I wrote at the time: “No CEO is safe in EdTech in 2025.” Both Coursera and Udemy now had brand-new CEOs. Neither would last a year before signing a merger agreement.

Less than a month into his job, Sarrazin met Hart at an industry conference on April 8. The prospectus doesn’t name the conference, but it’s quite obviously the ridiculously expensive ASU+GSV. The prospectus describes it as “an introductory meeting” where they “discussed, in general terms, the education industry.”

By June, Hart had come back with a real pitch: “the strategic rationale of a potential combination between Coursera and Udemy.” Udemy was open to it, but made its position clear: they wanted 46% of the combined company, same as the 2024 deal. Coursera said that “would not be appropriate at that time.”

A lot had changed since April 2024. Both companies had shrunk, but Udemy had shrunk faster. Then, on July 24, Coursera reported a strong Q2 that sent its stock up 20% in a single day. Udemy’s didn’t move.

Coursera was now nearly twice Udemy’s size.

A week later, on August 1, Coursera offered Udemy shareholders 39% of the combined company. In 2024, it had been 46%. Udemy rejected it outright. The prospectus says the offer “did not warrant a counterproposal.” By August 11, talks had collapsed for the second time in 16 months.

Then, in September, something unexpected happened.

Coursera’s Third Attempt

In September 2025, a Udemy shareholder went rogue. Without the company’s knowledge, they contacted Coursera directly to push for a deal. Coursera’s M&A Committee discussed it three times over 10 days. They decided not to act, but they hired a financial advisor. The seed had been planted.

Coursera’s Board discussed re-engaging in October, but agreed to wait for Q3 earnings. The earnings were bad. Coursera’s market cap dropped 13%. Udemy fell 18% in two days to below $850 million.

As I wrote on Class Central, Udemy’s strategy of “intentionally reducing” single course sales to push users toward subscriptions wasn’t working. Coursera’s new paywall and 15% platform fee hadn’t helped either. Since its IPO, Udemy had lost more than 80% of its value.

Within a week, both sides independently moved. On November 9, Coursera offered a mix of stock and cash that would give Udemy shareholders just 29% of the combined company. In April 2024, that number had been 46%.

Cash would lock in a lower price. Stock would let them benefit if the combined company did well. What followed was two weeks of rapid back-and-forth.

Udemy launched yet another market check, contacting eight new potential buyers. None made an offer.

Udemy said yes. On November 25, the companies signed an exclusivity agreement. Three weeks of due diligence followed. On December 11, Udemy’s CMO became the company’s fourth leadership exit of 2025. On December 16, both boards voted unanimously to approve. On December 17, the merger agreement was signed, and the deal was announced before the markets opened.

Two years, three attempts, and one rogue shareholder. That’s how Coursera finally acquired Udemy.

The Shrinking Deal: $3.8B to $1.7B

Both Coursera and Udemy received acquisition offers from third parties. Both were rejected.

Instead, they chose each other. But over the two years it took to get the deal done, both companies tried everything to fix their stock prices on their own.

Coursera restructured its executive team, then changed its CEO, laid off staff, put its courses behind a paywall for the first time in its history, and imposed a 15% platform fee on the university partners who supply its content. All while sitting on nearly $800 million in cash.

Udemy changed its CEO, cut 20% of its workforce, slashed instructor revenue share, pushed out its co-founder CTO, rolled out ads without sharing revenue with instructors, and pivoted aggressively from single-course sales to subscriptions. By December 2025, Udemy had lost four senior leaders in a single year.

None of it worked. Not according to the market, anyway. The combined company that was worth $3.79 billion when these talks started is worth $1.67 billion today. That’s a 56% decline in two years.

The businesses themselves are fine. Combined, Coursera and Udemy generated $1.55 billion in revenue in 2025. They have over $1 billion in cash. Udemy was profitable. Coursera generated more than $100 million in free cash flow. But the market values the combined entity at barely more than 1x revenue, and not much more than the cash sitting in their bank accounts.

That’s the backdrop to this entire two-year saga. The numbers kept getting smaller because the companies kept getting smaller, at least in the eyes of investors. In April 2024, Coursera offered Udemy shareholders 46% of a $3.8 billion company. In December 2025, they accepted 41% of a $2.2 billion one.

The vote is on April 9. Shareholders of both companies will decide whether two struggling companies are better off together. The prospectus makes a strong case.

But if the last two years are any indication, the market will need some convincing.

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