Inspired Education stake sale attracts Blackstone, EQT, H&F, KKR

Morgan Stanley and Goldman Sachs are advising on the sale.

Information memorandums should be circulated next week, one of the sources said.

Inspired Education, backed by Singaporean sovereign wealth fund GIC and buyout groups TA Associates and Warburg Pincus, is being marketed based on EBITDA of EUR 200m–230m, two sources familiar with the matter said. The higher end of that range is run-rated and accounts for greenfield developments that are underway, the first source added.

The sell-side has set a mid-March deadline for first-round bids, the first source said. While a minority sale is preferred, the size of the stake is not set in stone, it depends on valuation, and will be decided once bids are received, this source added.

EQT Infrastructure is in a strong position given that the firm's direct lending arm, Bridgepoint Credit, has in the past provided debt to Inspired and is therefore familiar with the company, an adviser working in the sector said.

Antin Infrastructure Partners, which owns France-based childcare giant Babilou, is also interested in Inspired, according to a seventh source familiar with the matter. However, Antin is only interested in a majority stake and is not expected to pursue a minority deal, this source added.

Inspired Education is targeting an enterprise value of at least EUR 4.5bn, the first source said. This indicates an EBITDA multiple of at least 19.5x based on the EUR 230m figure, or 22.5x based on EUR 200m. When GIC in June 2020 paid EUR 350m for a 16% stake, the firm was valued at EUR 3.05bn, equalling 21x EBITDA, according to a report by EducationInvestor Global. Partners Group-owned international school operator ISP last May sold a 25% stake to Omers in a EUR 1.9bn deal that valued the company at 21x EBITDA, as reported by EducationInvestor.

Inspired Education had also been contemplating an Amsterdam IPO alongside a private stake sale, having hired Morgan Stanley and Goldman Sachs as joint global coordinators of a dual-track strategy, according to a report published last May by EducationInvestor. Citigroup and Bank of America Merrill Lynch had been appointed as joint bookrunners, the report stated.

However, the firm is currently prioritising a stake sale over a flotation, according to the first source. An IPO of dual-class shares could still be explored in due course, this source added.

Previous acquisitions by Inspired include that of formerly UK-listed online school operator Wey Education last April for GBP 70.4m.

Founded in 2013 by chairman and CEO Nadim Nsouli, Inspired educates more than 56,000 students at its 75 schools in 21 countries.

When contacted by Unquote's sister publication Mergermarket for comment, Nsouli said: "We have raised capital over the years from leading long-term blue-chip institutional investors. We are currently considering another similar capital raise to allow for further expansion globally.

"Any transaction will firmly maintain the control of Inspired, with me as chairman and CEO, and lead to no changes in our entrepreneurial culture, which has seen us become one of the largest education groups globally with an unparalleled reputation of excellence in education." Nsouli declined to comment further.

Antin, Blackstone, EQT Infrastructure, H&F and Warburg Pincus declined to comment. Goldman Sachs, Morgan Stanley, TA Associates, GIC and KKR did not respond to requests for comment.

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• Topics
• Expansion
• UK / Ireland
• Consumer
• GIC
• Morgan Stanley
• Goldman Sachs
• TA Associates
• United Kingdom
• Emerging Markets