Several private equity houses are vying for control of Talis Education, a group of for-profit universities in France, for which final bids are due at the end of next month, EducationInvestor Global can reveal.
This publication has learnt that IDI and LBO France have tabled second-round bids for a controlling stake in Talis, the sale of which is being led by Rothschild & Co.
IDI has one education company in its portfolio – Formalian, a France-based provider of occupational training targeted at the wellness market – while LBO France has no active investments in the sector.
Meanwhile, pan-European buyout firm Equistone Partners, which progressed through the first bidding round, has dropped out of the race to acquire Talis, this publication can confirm.
It is unclear whether any other suitors, in addition to IDI and LBO France, plan to table final bids for Talis.
A source said that Talis, owned by its founder and two private equity houses, will fetch over €120 million – at least 10-times its full-year 2021 earnings before interest, tax, depreciation and amortisation (EBITDA) of €12 million.
Rothschild will collect final bids at the end of May on behalf of Talis’ owners, founder and president Serge Marcillaud (majority shareholder), and private equity groups Azulis Capital and Aquiti Gestion (minority shareholders), it is understood.
In January, EducationInvestor Global exclusively revealed that Rothschild had been chosen to steer the sale of Talis and highlighted the likelihood of a private equity play.
Competition between IDI and LBO France underscores a deepening desire among French buyout groups to tap the country’s thriving for-profit higher education market, in which private equity plays an increasingly important role.
“When it comes to French higher education deals, there tends to be a local solution,” said an investment banker, alluding to the growing influence of domestic capital in the market.
In March 2019, international buyout group Cinven acquired INSEEC, which operates four campuses in France and five overseas, for €800 million.
Last March, France-based Galileo Global Education, Europe’s largest for-profit university group, was taken over by a Canadian pension fund and French family office in a €2.2 billion transaction revealed by this publication.
More recently, in December, France-headquartered higher education platform AD Education was taken over by Study Group, which is backed by French buyout firm Ardian.
The auction of Talis has been run alongside the sale of a minority stake in university giant GUS, which Rothschild is also overseeing, as revealed by EducationInvestor Global. Rothschild was also leading the sale of ACE Education, a private equity-owned group of three universities in France, which has not yet been finalised. Earlier this week, this publication revealed that Rothschild has been awarded a mandate to explore the sale of Eurazeo-owned Sommet Education, a group of hospitality education providers.
IDI And LBO France failed to respond to several phone calls and emailed requests for comment.
Spokespeople for Rothschild & Co and Equistone Partners declined to comment.
Founded in 1978 by Marcillaud, Talis Education is a formation en alternance – dual education – provider, which blends on-the-job training with academic studies in subjects such as commerce, communication, human resources, technology, finance, fashion, banking and media.
Three institutions operating nine sites comprise Talis Education Group. Talis Business School has locations in Bergerac, Perigous, Bayonne, Bordeaux and Paris. Talis Itinerary Employment has campuses in Bergerac, Perigous, Bordeaux and Byonne. Akor Alternation operates from a single campus in Paris.
Last January, Azulis Capital and Aquiti Gestion paid €23 million for a significant minority stake – around 40% – in Talis Education from Naxicap Partners, which since 2011 had owned this portion of equity. It is understood that Marcillaud controls the remaining 60% stake.
Date published: 16 April 2021