A European private equity house is in exclusive talks to acquire French e-learning provider Woonoz in a transaction that could value the firm at more than €50 million, EducationInvestor Global can reveal.

EIG has learnt that mid-market buyout group 21 Invest is in the process of finalising a deal to acquire a majority stake in Woonoz from its founders and financial sponsors, BNP Paribas Development and Evolem Start.

The transaction will be structured as a management buyout, which would see 21 Invest provide a multi-million-euro capital injection in exchange for more than 50% equity in Woonoz and provide strategic support to the firm’s management team.

Woonoz’s co-founders Pascal Hostachy, Francois Paret and Fabrice Cohen, as well as family office Evolem Start and BNP Paribas’ growth capital arm, are set to exit under the terms of the transaction, it is understood.

Founded in 2005 and headquartered in Lyon, Woonoz sells a range of online learning solutions, including trademarked Anchoring Mémoriel – Memory Anchoring – technology designed to improve the memorisation of training content by professionals. Woonoz is also the publisher of Projet Voltaire, a digital spelling-revision tool launched in 2008 that was the bedrock of the business for nearly a decade.

Banking sources told EIG that a takeover of Woonoz could give the organisation an enterprise value of more than €50 million, predicated on a low- to mid-teens multiple of its annual earnings before interest, tax, depreciation and amortisation (EBITDA), marketed as €4 million.

The deal – which is not guaranteed – would mark a fresh foray by 21 Invest into Europe’s burgeoning ed tech sector. Between 2011 and 2018, 21 Invest backed France-based vocational e-learning platform Skill & You prior to its ownership by Andera Partners, which in February exited to IK Investment Partners in a €300 million-plus deal, as reported.  

EIG exclusively revealed in April that Cambon Partners, a France-based M&A boutique, had been hired to oversee the sale of Woonoz.

In Woonoz, 21 Invest sees an opportunity to acquire a high-margin company that was already expanding at a healthy rate prior to the Covid-19 pandemic, which spurred a major tailwind behind online education providers, driving up asset prices in the process, sources said.

Woonoz has showcased robust growth in recent years, having more than doubled its revenue to around €13 million since 2017, when the organisation booked annual sales of around €6 million. In 2018, Woonoz recorded turnover of €10 million, according to Les Echos Capital Finance.

In acquiring Woonoz, 21 Invest would gain a toehold in Europe’s booming ed tech market, which last month minted a new unicorn, GoStudent, which was valued at $1.7 billion following a $244 million Series C fundraise.

Following the acquisition, 21 Invest would likely look to expand Woonoz via a combination of M&A and organic growth, achieved by entrances to new international markets.

Interest among private equity in providers of specialist learning solutions – like Woonoz – is deepening.

In December, Five Arrows, the private equity arm of Rothschild & Co, acquired Texthelp, whose digital tools assist dyslexic students with reading, writing and numeracy. In the space of just seven months since its takeover by Five Arrows, Texthelp has bought two businesses – Lingit Group from investment group Verdane, and, most recently, Denmark-based Wizkids.

21 Invest and sell-side advisor Cambon Partners had not responded to emailed requests for comment at the time of publication.

Date published: 20 July 2021

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