A global private equity firm and an international school operator have submitted non-binding bids for Singapore-based Canadian International School (CIS) owned by private equity firm Southern Capital, according to industry executives aware of the matter.
CIS is one of Singapore’s largest international schools with approximately 3,000 students across its two campuses in Lakeside and Tanjong Katong, according to its website. Offering kindergarten to grade 12 (K-12) learning, it caters to students from local and expatriate families.
The international school’s PE owner had asked for non-binding bids to be submitted by February 7. EQT Partners and Singapore-based Global Indian International School (GIIS) are understood to be among bidders to have formally expressed interest.
PE major Carlyle Group was learnt to be eyeing the asset too. However, it is unclear if it formally submitted a bid.
Email queries to EQT Partners, GIIS and Southern Capital had not been answered at the time of publishing. A Carlyle spokesperson declined to comment for this story.
Bloomberg had in September 2019 first reported that middle market-focused Southern Capital was exploring options for CIS, including a potential sale that could fetch at least $500 million.
Southern Capital had partnered Hong Kong-based Headland Capital Partners, which has since been renamed as HPEF Capital Partners, to acquire CIS in December 2014. The investment firms bought the asset from Knowledge Universe Education, an indirect subsidiary of Keppel Corporation, for S$460 million, according to WongPartnership that acted as a legal adviser to the acquirers.
Southern Capital continues to remain a majority stakeholder in CIS. It is unclear if HPEF Capital Partners, an HSBC spinout that had reportedly axed half its investment team in 2016 after halting fundraising for its seventh fund, retains a stake in the international school operator.
Aside from CIS, Southern Capital is understood to be exploring options for two other education assets in its portfolio, namely Singapore-based early childhood education and daycare centre chain Star Learners and Malaysia-based private education institution HELP International Corporation.
Industry insiders say education-related assets in Southeast Asia will need a regional presence to significantly pique investor interest. This is especially true for deals originating from Singapore, which has a small domestic market.
That said, the education sector in the region offers an attractive opportunity due to its young population and rising middle-class affluence. Education investments also typically pay handsomely in the long run for investors. “It takes time to build a good reputation, but once that is done, schools are a cash cow,” said an industry executive.