The Economic Times of India reported that HDFC Bank and Gaja Capital Partners bought a stake in Indus World Schools (IWS), a unit of Career Launcher India Limited, for around Rs.40-50 crore. According to the report, Indus World plans to use the raised funds for its expansion strategy, as it plans to increase its current 9-school chain to 75-school chain over the next five years.
The first Indus World School was opened in 2005 in Hyderabad and currently, IWS is a 9-school chain spread across cities like Indore, Hyderabad, Raipur, Bhiwani, Mandi, Ahmednagar, Gurgaon, Jalgaon, and Aurangabad. IWS also runs schools for the underprivileged in rural Andhra Pradesh and through partnerships with the government in Punjab and Gujarat.
On the other hand, Career Launcher was founded in 1995 and provides test preparatory and vocational training services to over 60,000 students across 130 locations in India and overseas locations such as West Asia and the US. Last year, Career Launcher acquired a minority stake in Chennai based 361 Degree Minds Pvt Ltd for $1 million.
Private Equity firm Gaja Capital Partners invested $8.20 million in Career Launcher in 2007. Its other investment companies are Haldia Coke & Chemicals, TeamLease Staffing Solutions, Bonanza Portfolio and Educomp Schools. This is the first such investment by HDFC.
Last year, the Indian education sector saw deals like Aavishkaar's investment in Butterfly Edufields Limited for a 26% stake, Matrix Partners' Rs.40 Cr investment in Tree House Education and Accessories, Mayfield India Fund's Rs.40 Cr investment in Centum Learning Ltd, among others. Recently though, the education sector saw Pearson’s purchase of TutorVista, New Silk Route's investment in Hyderabad's Shri Chaitanya and Dubai-based QInvest's investment in FIITJEE.
Gaja Capital Partners provides up to Rs. 125 crore of equity capital to Indian entrepreneurs looking to grow their businesses. In the arrangement, the firm becomes a stakeholder in the company and a partner to the management for a period of 5-7 years.
During its partnership, Gaja Capital helps grow these businesses in various ways including new business development, fund-raising and mergers & acquisitions. Such partnership ultimately leads into an IPO or a sale of Gaja Capital Partners stake in the company.
HDFC Bank was incorporated in August 1994, and, currently has a nationwide network of 1,725 Branches and 5,016 ATM's in 780 Indian towns and cities, making it one of the foremost banks/lenders in the country.
Source: Invest In India