Sale of Eurazeo's Sommet gets underway

Josh O'Neill, Francesca Veronesi, Johannes Koch and Amy-Jo Crowley
03 December 2021

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The sale process for Switzerland-based Sommet Education, an operator of hotels and hospitality schools, has kicked off with the recent distribution of information memorandums and indicative bids slotted for mid-January, according to two sources familiar with the matter.

Sommet is being sold based on adjusted EBITDA of CHF 46m (EUR 44m), four sources said. Rothschild is advising the owner, Eurazeo.

IK Partners and Providence are signalling preliminary interest in the asset, two of the sources said. Wendel is also in the mix, according to one of the sources, while L Catterton looked at the asset over the summer, according to another source.

Industry players are also eyeing the business, two of the sources said. "Given how badly the pandemic hit the hospitality sector, Sommet is most likely going to a trade bidder," one of the sources said.

Sommet is unlikely to achieve the valuations of recently sold French peers AD Education and Galileo Education, due to the asset's exposure to the hospitality sector, according to three sources.

AD Education, a private higher-education provider, was acquired last December by Ardian in a deal estimated to be worth EUR 600m, implying a 20x EBITDA valuation multiple. Elsewhere, Galileo Global Education was acquired by Canada Pension Plan Investment Board, Montagu, Téthys Invest and BPI France for an enterprise value of more than EUR 2bn.

In the run-up to the sale process, Sommet has doubled its global footprint with its acquisition of South Africa's Invictus Education Group, according to a press release.

Headquartered in Switzerland, Sommet operates a network of hospitality management institutions and culinary arts schools with campuses in France, Switzerland, Spain, the UK and China. Its institutions offer private courses, as well as undergraduate, graduate and executive education programmes to suit a wide range of career goals and country preferences, according to its website.

Sommet, Eurazeo and ICG declined to comment. Rothschild, Wendel, IK Partners and Providence did not respond to requests for comment. L Catterton could not be reached for comment.

Unquote reported in April 2021 on the dynamics at play for sponsors investing in the education sector, following a number of processes crossing the finish line.

Recent exits in the sector include ECI Partners selling its stake in educational safeguarding software developer CPOMS to US-based Raptor Technologies, a portfolio company of Thoma Bravo and JMI Equity. Tenzing also sold education safeguarding technology provider Smoothwall in a GBP 75.5m deal that saw the GP score returns of 5.6x, as reported. Further deals include Omers' investment in Partners Group's International Schools Partnership in May 2021, which saw the company valued at EUR 1.9bn.