Aurelius makes 11.6x on €76.5m sale of Studienkreis to IK

Oscar Geen
22 November 2017

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IK Investment Partners has acquired learning centres business Studienkreis from Aurelius Equity Opportunities for an enterprise value of €76.5m.

Aurelius generated a return of approximately 11.6x on its investment in the company.

Studienkreis projected an adjusted EBITDA of €9.9m for 2017, a 15.5% margin on its projected €64.2m revenues.

This is an entry multiple of 7.7x for IK, which drew equity from its €277m IK Small Cap I Fund. The vehicle held a final close in March 2016 and was approximately 55% invested as of May 2017, according to unquote" data.

Aurelius invested €1m in the company's existing centres and €1.6m to expand to new locations and acquire third-party institutes. Studienkreis also introduced a digital marketing strategy and acquired tutorial.de, as well as establishing its own online tutoring team of approximately 20 experts.

In total, Studienkreis has opened 120 new locations since January 2013, when Aurelius acquired the group.

The private tutoring market in Germany has been a popular sector for private equity this year. DBAG notably sold Schülerhilfe to Oakley Capital for an estimated €275m enterprise value (11.6x EBITDA) in May 2017.

Previous funding
Aurelius acquired Studienkreis from the Franz Cornelsen Education Group in January 2013. The group reported EBITDA of -€8.4m in 2011, but Aurelius said the turnaround process was started by the previous owner and it was profitable by the time of the acquisition, reporting €1.8m adjusted EBITDA for 2012.

Company
Studienkreis was founded in 1974 and is headquartered in Bochum. It operates a network of 1,000 learning centres and offers small-group tutoring to 60,000 primary and secondary school students across Germany. It also offers online tutoring and has developed the Studienkreis app for homework support.

People
IK Investment Partners – Anders Petersson (partner).
Aurelius Equity Opportunities – Dirk Markus (CEO).

Advisers
Vendor – Raymond James (corporate finance); EY (financial due diligence).
Acquirer – Goetzpartners (corporate finance); PwC (commercial due diligence); Renzenbrink (legal).