Early childhood education will be revolutionised: Rajesh Bhatia

Interview with MD, Tree House Education and Accessories

Tree House Education & Accessories has announced a merger with Zee Learn. Rajesh Bhatia, founder and managing director, talks about the deal to M Saraswathy. Edited excerpts:

With the merger of two large players in the early childhood education segment, what would the combined look like in terms of size?

The entire 2,000 pre-schools and 100-plus primary schools, comprising Zee Learn, Kidzee, Tree House centres and Global Champs.

The biggest comparable entity in the world has 300,000 students and it is possible to create a similar size in India, probably more, if you consider the favourable demographics here. The size of the combined entity will make it a global-sized operation, for the Indian consumer. However, numbers apart, good product and service is more important.

 

The new management team for the combined entity?

Zee Learn’s and our human resources. There would be cultural integration. I would be the managing director of the new entity. More teachers and more people will be needed; there will be job creation for teachers and women, as entrepreneurs for the franchisees. All our employees would move into the new entity.

What was the rationale for a merger?

The visionary in this whole set up is Subhash Chandra (chairman of the Zee group). The vision was to have a large-size national education company. At Tree House, we have been able to show execution capacity. Our leadership is going to bring about a revolution in kindergarden and early childhood education, and in preparatory schools, across the country. High quality English-medium schools are the need and we provide high quality delivery across various platforms. The market is fragmented and consolidation has to happen.

From a merged entity perspective, what would be the growth strategy?

We would first consolidate and capture each other's strengths. There would be cultural integration. At Tree House, we have been focused on building an asset-light company. That same focus will be there with Zee Learn. We are very clear that the combined entity over the next couple of years will move towards an asset-light, zero debt company that will be cash flow-positive.

Any changes in the business model? Would the brand names be retained?

We have the strength of brick and mortar, largely in urban areas, and the Kidzee model which is giving opportunities to women entrepreneurs via their franchisees in rural areas. There is a huge synergetic force of Tree House's execution ability with the marquee brands of Zee Learn, complementing each other. The Kidzee and Tree House brands will be there, as also the other ones, as each has a brand value and significance.