October 21, 2019 / 10:36 AM / 22 days ago

Brazil's Yduqs buys Adtalem for $467 million: securities filing

SAO PAULO (Reuters) - Brazilian education company Yduqs (YDUQ3.SA) has bought Adtalem Global Education Inc’s (ATGE.N) assets in Brazil for 1.92 billion reais ($467 million) as it continues to pursue bolt-on acquisitions, it said in a securities filing on Monday.

Adtalem is Brazil’s 10th largest private-sector higher education company, with 102,000 enrolled students, Yduqs, formerly known as Estacio, said.

Shares in Yduqs opened up 5.5%, following the acquisition announcement.

The total amount of the acquisition will be paid in cash at closing of the transaction, which depends on regulatory approvals and is expected to take place sometime in the first half of 2020.

In addition to the enterprise value of 1.92 billion reais, Yduqs said Adtalem’s “pro forma” cash position included in the deal was 305 million reais.

“The transaction’s value includes a locked-box mechanism in which all cash generated from Adtalem’s operations between June 30, 2019 and the closing date will remain in the acquired company,” Yduqs also said.

The acquisition raises the total number of students of the two entities to 678,000 and their combined 12-month sales to 4.485 billion reais, Yduqs said.

Adtalem said in a securities filing on Monday it will use the proceeds of the sale for share repurchases and investments, including acquisitions.

Adtalem’s move comes as the for-profit education chain is revising its global strategy, currently focused on three areas: medical and healthcare, professional education and technology and business.

Reuters first reported that Adtalem had decided to put its assets in Brazil up for sale and reported last week the exclusive talks with Yduqs.

Reporting by Ana Mano and Carolina Mandl; Editing by Jan Harvey and Emelia Sithole-Matarise and Nick Zieminski

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