Heavy-hitting group ups $3.8bn Laureate bid

A consortium of big-name banks, hedge funds and private equity firms has increased by 2.5 percent its offer for higher education provider Laureate. The board-agreed amendment increases the price-per share to $62, up from $60.50.

Laureate Education has agreed to an amended take-private agreement for $3.82 billion (€2.84 billion), or $62 per share, with the same, star-studded group of investors.

It is effectively the fifth offer from the consortium led by Laureate chairman and chief executive, Douglas Becker, and backed by Kohlberg Kravis Roberts. KKR’s publicly listed Euronext vehicle, as well as Citi Private Equity, SAC Capital Management, SPG Partners, Bregal Investments, Caisse de dépôt et placement du Québec, Sterling Capital, Makena Capital, Torreal and Brenthurst Funds are also investors.

The higher education provider had agreed on 5 January to a $60.50 per share offer, having previously rejected three bids from the group.

Debt financing for the transaction will be provided by Goldman Sachs, Citi Markets & Banking, Credit Suisse, Credit Suisse Securities (USA), JPMorgan Chase, and JP Morgan.

Morgan Stanley and Merrill Lynch were financial advisors and provided fairness opinions to the Laureate special committee, while Pillsbury Winthrop Shaw Pittman is its legal advisor. DLA Piper was legal advisor to Laureate. Citi Markets & Banking and Goldman Sachs were financial advisors to Becker and the investor group and Simpson Thacher & Bartlett and Katten Muchin Rosenman provided legal counsel.

Laureate, which has a $3.2 billion market capitalisation, operates 24 private universities in 15 countries and has a growing online business. It employs approximately 25,000 people.

Other recent deals in the education space include a secondary buyout of the UK’s biggest education publishing business, TSL Education, in which Charterhouse Capital Partners bought the company from Exponent Private Equity for an undisclosed amount; and the Thomson Corporation’s $8 billion agreement to sell its higher education assets to Apax Parnters and OMERS Capital Partners, the investment and management division of Canadian pension fund Ontario Municipal Employees Retirement System.