Everonn Education, among India’s largest education firms will be soon getting private equity infusion from world’s leading marquee investors.
Everonn last saw investments two months back in September when Dubai-based Varkey Group, a $2.5-billion education company that runs Gems Education brand, bought 12 per cent equity for Rs 138 crore in a strategic move. It was expected to make an open offer for 26% stake raising their stake to 38 per cent but it has been deferred.
As per the sources, global private equity majors — Carlyle Group and New York Life Capital Partners — are in advance talks with for acquiring a stake in the company with the initial due diligence already over.
The investment being discussed is over Rs 500 crore ($100 million) through a combination of primary and secondary market transactions, probably the largest private equity (PE) investment in the Indian education space till date.
Everonn’s promoters will probably dilute their stake and may even issue fresh shares to these two new financial investors. Carlyle and New York Life Capital are likely to invest in the listed company – Everonn Education — and may also pick up strategic stakes in the underlying subsidiaries Everonn Medical Education and Everonn Skill Development.
Everonn Skill Development is a 73: 27 joint venture between the company and National Skill Development Corporation.
According to shareholding data of September, the total promoter shareholding in the company stands at 42.28 % . SKIL Infrastructure, promoted by Nikhil Gandhi, the largest shareholder with 20.83 % stake and P Kishore, the controversial founder of the company, has 8.52 per cent
Everonn has had an roller coaster ride in the last one year. In December 2010, Everonn Education received the best ‘Franchisable concept of the year 2010’ from Franchise India in education category, and was the darling of investors for excellent results and admired by industry players who wanted to emulate it.
How ever in August 2011, company’s shares plunged 20 per cent after its managing director, P Kishore was arrested on a bribery and tax evasion charge and its shocked chairman, J J Irani, resigned and same industry players started questioning its rise.
Everonn is known for its pioneering work in e-learning solutions for schools and virtual classrooms. Its customer base is over eight million students through 10,139 learning centres across 27 states. It has had a series of financial investors like Blackstone, Reliance ADAG Group and New Vernon in its 20 year history. New Vernon India is still an investor with a 5.12 per cent stake. However , most of them have pared their stake since Everonn’s founder was arrested on bribery charges.
Lets hope that with this new Venture Capital infusion, Everonn puts its past behind and charts new growth path.
(Source: Business Standard)