Creador, SMRT seek buyout of Malaysia’s Masterskill Education
Creador and SMRT Holdings have agreed to buy a 30.75% stake in Malaysia-based Masterskill Education Group from the major shareholder for MYR69.4 million ($19.2 million) and now plan on completing a full buyout of the business.
The Southeast Asia and India-focused GP will buy 29.2 million shares - or a 7.75% stake - in Masterskill from Siva Kumar for MYR0.60 apiece, according to a regulatory filing. SMRT, a Bursa Malaysia-listed IT services provider with an interest in human resources and education, has agreed to buy 86.5 million shares - or 23% of the company - from Kumar at the same price.
Creador entered into an agreement to buy a 19.26% interest in Masterskill towards the end of 2014 for a sum not exceeding MYR43.4 million. This means Creador and SMRT's combined ownership will cross the 50% threshold on completion of the acquisition from Kumar. As such, the investors have offered to buy all the remaining shares, also at MYR0.60 apiece.
The takeover would value the entire company at approximately MYR225 million.
Brahmal Vasudevan, CEO of Creador, told local media that he was confident the combination of Creador's financial expertise and SMRT's experience in the education sector could deliver a turnaround at Masterskill and break even within a year.
The company is a leading provider of nursing and health education in Malaysia, principally in higher education and vocational training. It has two associate institutions - the Asia Metropolitan University and Masterskill Global College.
Masterskill generated revenue of MYR63.4 million in 2013, down from MYR148.8 million the previous year. Net losses escalated from MYR28.2 million to MYR162.9 million. Masterskill last turned a profit in 2011.
Should the acquisition go through, Creador and SMRT would maintain Masterskill's Bursa Malaysia listing but rename the business Asiamet Education Group. They will explore potential synergies between Asia Metropolitan University and SMRT-owned Cyberjaya University College of Medical Sciences in order to cut costs and bring in industry leaders to serve on the company's board.
Creador's investment will come from its second fund, which closed at $300 million last year before squeezing in an additional LP commitment to take the total to $330 million.
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