Stadio and Brimstone buy 100% of MBS Education for R320 million
JSE-LISTED companies Stadio Holdings and Brimstone Investments agreed to acquire 100 percent of issued share capital of MBS Education Investments (MBS Education) for R320 million, they said on Friday.
MBS Education is the investment holding company that holds 100 percent of the issued shares of Milpark Education (Milpark).
The companies would make the acquisition through a newly incorporated private company, Milpark Investments SPV (Milpark SPV), in which Stadio would have an effective interest of 70 percent and Brimstone 30 percent at the date of acquisition.
Stadio and Brimstone are acquiring the asset from Co-öperative Apollo Global Netherlands and Encosolve.
The newly listed Stadio, which was recently unbundled from Curro Holdings, said in its pre-listing statement that it intended to acquire several additional programmes, including degrees, higher certificates and diplomas in order to expand its offering to students.
The acquisition of Milpark provides Stadio with a wide variety of additional qualifications in the business and commerce faculty and will assist Stadio in widening access to higher education in South Africa.
Brimstone and Stadio have entered into a strategic relationship last month in matters of importance, and this intended acquisition signals the beginning of their relationship.
“Brimstone has assessed the fundamentals of the South African higher education landscape and believes the opportunity to invest in it to be attractive and Stadio to be the ideal partner to invest with. The acquisition further entrenches the longterm strategic relationship between Brimstone and Stadio announced on September 15,” Brimstone said.
According to the financial information provided by one of the sellers, Apollo, the audited annual financial statements put the net asset value of Milpark at R64.74m at the end of August, while profit after taxation amounted to R13.19m. Its adjustable earnings before interest, tax, depreciation and amortisation came in at R33.64m.
The acquisition though has to meet a number of regulatory approvals, and that includes obtaining approval from the Competition Commission and the JSE.
Milpark was established in 1997, being one of the first private providers of higher management education in South Africa.
The purchase consideration will be settled in cash by Milpark SPV and the acquisition is expected to be concluded in February next year or immediately thereafter.
Milpark currently has 18 key accredited higher education programmes and is accredited to offer tuition towards 15 further education and training qualifications and 18 registered learnerships. Milpark also offers Master of Business Administration degrees.