Wizard purchases 100% of Yázigi English school
Valor Econômico
After nine months of negotiations, the Multi group, owner of Wizard and another eight brands of English and training schools, acquired the entire capital of Yázigi, a traditional chain of language schools with annual earnings of R$ 250 million (US$ 147.1 million). The value of deal amounted to R$ 100 million (US$ 58.8 million), including the debt, according to information of the market. The two companies informed they would make no announcements on the value of the deal. The operation was conducted by Kinea, a private equity fund of Itaú, which last week announced the purchase of 20% of Multi, investing R$ 200 million (US$ 117.7 million). Until then, Yázigi had strong resistance to be sold to the rival group.
"The entrance of Itaú was essential for the wrapping up of the deal. We believe the bank will add governance to the Multi group, which has plans of going public", said Alexandre Gambirasio Silva, son of one of the five shareholders of Yázigi. He will remains as an Executive in operation for nearly six months. In the market for 60 years, Yázigi was founded by the Silva family, which has among its members Ricardo Young, entrepreneur who was a candidate to the Senate by the Green Party (PV) in the last elections. He was not elected.
"The Kinea was a very interesting opportunity because we were in search of a minority partner to invest and bring an acquisition. That was exactly what happened", said Charles Martins, Chairman of the Board of Directors and son of the founder of Multi, Carlos Martins. The resources for the purchase of Yázigi were raised in the market instead of with the investment of Kinea, which has not yet been completed.
In the process, multi competed with the Buffalo Investimentos, a private equity firm that in August announced the acquisition of the education system Universitário and set up an investment fund in the educational area. "We made a firm offer for Yázigi, but they were already in advanced negotiations with Multi", said Alexandre Scolfaro, responsible for the fund in the area of education of Buffalo.
Yázigi was the fifth company bought by Multi only this year. In the past months of 2010, the group acquired Bit Company, Quatrum, Microlins and SOS computadores. The expectation of the holding, which now owns nine brands of language schools and professional training courses, is to end this year with gross revenues of R$ 2.3 billion (US$ 1.35 billion). According to Martins, the goal is to turn Yázigi into a premium brand intended for the class A public.
The Wizard chain would be for class B students, Skill for the public of class C and the Alpes schools for class D. Such division, however, is seen by the competition with certain suspicion. "The public of class A normally studies abroad or chooses to study at language schools like Alumni, Berlitz, Cultura Inglesa or Cel-Lep", said a source of the sector who prefers not to be identified.