)
Educomp Solutions Ltd, India’s largest education company, today announced that it has completed the sale of its entire 50% stake in Eurokids International Limited to a group of investors led by GPE India.
Without disclosing the deal size, the company said it made a profit of Rs 70 crore on this investment, and that the proceeds would be ploughed back into its core businesses.
Educomp had finalised the stake sale on January 8, and the transaction has been completed today, after meeting the customary conditions precedents, the statement said.
Shantanu Prakash, chairman and managing director, Educomp Solutions Ltd, said, "This transaction is an important milestone for the business transformation agenda that is currently underway. Educomp has made 3x its original investment in Eurokids and has created significant value for its shareholders by making a profit of approximately Rs 70 crore on this investment."
He added that Educomp’s business transformation agenda is progressing well on track.
"Our strategy is to focus on one hand on our core businesses of digital content offerings & asset-backed offerings and to monetise the non-core assets to unlock value," Prakash said.
As a result, earlier in the year, Educomp sought growth capital investment of Rs 22 crore in its internet education platform business Authorgen, from Kaizen PE and Bertelsmann.
"The transaction has insulated Educomp from any further capital infusion requirement, while at the same time, there is a potential value creation upside maintained through a minority equity stake", the company statement claimed.
As Prakash said, "The completion of the Eurokids transaction is the second milestone in our asset monetization strategy. The proceeds from the transaction will be ploughed back into our core businesses as well as used to de-lever our balance sheet."
