PremjiInvest sows Rs200 crore in Manipal Education field

Out of the Rs2,000-crore Manipal Education and Medical Group, which has a range of investments in education and healthcare, Azim H Premji private investment venture has announced a Rs200 crore investment in Manipal Universal Learning. Over the next few years, the money will fund the group's $100 million (Rs460 crore) expansion plans in India and overseas. The Wipro Ltd chairman has a philanthropic interest in school education through an eponymous foundation, but this is his first commercial investment in the education sector. The $1 billion PremjiInvest has investments in 40 companies, including National Stock Exchange of India Ltd and Carnation Auto Services Pvt. Ltd. The proceeds will help Manipal Universal build a 200,000 sq. ft academic block in Dubai, a dental campus in Malaysia, student housing and academic blocks in Antigua, setting up 500 training centres under vocational training arm Manipal City and Skills Training Pvt. Ltd, a technology upgrade across the group and an upcoming campus in Jaipur, said Anand Sudarshan, MD and CEO of Manipal Education. “The remaining capital needs for the expansion will be funded through debt and internal accruals,” he added, while declining to elaborate how the Rs200 crore would be spread across various projects. PremjiInvest is the third private equity (PE) partner in the Rs720 crore Manipal Universal. In 2006, IDFC Private Equity Fund along with US investment firm Capital Group invested Rs300 crore into it. While two non-profit trusts run Manipal University and Sikkim Manipal University, Manipal Universal does distance education and runs the international campuses. Prior to this deal, Manipal Education held over 80% in Manipal Universal. Sudarshan declined to disclose the shareholding of Manipal Education post the latest stake sale. Says PremjiInvest chief investment officer Prakash Parthasarathy, “Education is a vibrant, high-growth sector with a clear need for branded companies like Manipal.” He declined to disclose if the fund would invest in other education ventures. The 68-year-old Manipal Education has grown from a single primary school to a group catering to 175,000 students in 14 professional streams, with campuses in Manipal, Bangalore and Sikkim in India, and Dubai, Nepal, Malaysia and Antigua. PE deals in schools and higher education in India have been few and far between. Says Gopal Jain, partner at Gaja Capital Partners, an India-focused PE fund, “A country like India needs capital very badly, but because of government regulations it will attract very little (in education).” Jain feels that Manipal Universal is a global education player and not merely a domestic one.