Advtech bolsters presence in Africa
• Education group buys private schools in Kenya and Uganda to grow numbers, with aim of acquiring centres throughout continent
Education group Advtech has bolstered its African presence with recent forays into the private schools market in Kenya and Uganda. On Tuesday, the company, which owns the Crawford Colleges, Trinity House and Abbotts private school brands in SA, confirmed the acquisition of the Makini group of schools in Kenya.
Education group Advtech has bolstered its African presence with recent forays into the private schools market in Kenya and Uganda.
On Tuesday the company, which owns the Crawford Colleges, Trinity House and Abbotts private school brands in SA, confirmed the acquisition of the Makini group of schools in Kenya for an undisclosed sum.
The deal seems well timed, with Advtech set to open its first Crawford International School in Nairobi in September.
Advtech made its first move into the rest of Africa in late 2014 when it acquired the Gaborone International School in Botswana for R84m.
The Makini group, which was founded in 1978, operates eight schools on four campuses in Nairobi and Kisumu. The schools cater to 3,200 pupils from kindergarten to grade 12.
The deal follows the establishment of a new partnership between Advtech and Schole, which has managed various schools in sub-Saharan Africa since 2012.
Advtech CEO Roy Douglas said the new partnership would look to acquire schools across the continent with an aim of building a network in the midfee segment.
Advtech holds a majority stake, with the remaining shareholding held by the original founders of Schole International and Caerus Capital, an education consultancy group. The partnership will also manage Kisubi High School, a co-ed mid-fee boarding school in Kampala, Uganda, with 900 pupils.
Douglas said Advtech had been diligent in its investigations to secure the right business partners to help sustainably grow the company’s mid-fee offering and increase access to affordable education in the rest of Africa. “It is important to identify partners who know and understand the local markets, with extensive experience in operating schools throughout East Africa. We are confident that we have assembled the best team possible,” he said.
The African thrust comes at a time when growth has slowed at Advtech’s school division.
In the year to end-December, the division reported a 14% growth in revenue to almost R1.9bn, with normalised operating profit increasing 3% to R330m. At the time, Douglas said that certain schools were affected by the financial pressure on consumers and high levels of emigration.
About 11% of Advtech’s revenue was generated in the rest of Africa in the past financial year. Douglas, however, recently said the company, which also has a sizeable tertiary education arm, was on track to meet a 2020 target of generating 30% of revenue from African operations.
Anthony Clark, an analyst at Vunani Securities, said the acquisition by Advtech of new schools was a positive strategic move that augmented the company’s existing expansion plans into Africa. “The schools being acquired could be ‘feeder schools’ into the new Crawford International campus that is being built in Nairobi,” he said.
IT IS IMPORTANT TO IDENTIFY PARTNERS WHO KNOW AND UNDERSTAND THE LOCAL MARKETS