Mumbai-based education firm MT Educare Ltd has proposed to sell its pre-university college campus along with its hostel facility in Mangalore, Karnataka and get into a lease-back agreement for the unit, the company said in a stock market disclosure. It did not disclose the deal value or the name of the proposed buyer.
The education firm had acquired land parcels aggregating 1.48 acres and constructed Mahesh PU College campus and hostel building at Mangalore in Karnataka in 2011. The campus, which has been operational since February 2013, comprises classrooms and other facilities like a library, an auditorium, a playground and administrative offices.
Though the sale and leaseback of PUC campus and hostel building, the firm aims to liquidate the asset to move into an asset-light model and to enhance cash reserves. The company also expects the Karnataka business to grow at the same pace as seen in the last couple of years, as per a postal ballot notice to its shareholders.
Founded in 1998, Mumbai-based MT Educare (formerly Mahesh Tutorials Pvt Ltd) offers coaching for Std IX-Std XII students, besides engineering and medical entrance tests, as well as for CA CPT, CS, CWA and professional CA (IPCC & Final) exams.
The firm posted a profit of Rs 21 crore in the year ended March 31, 2014 compared with Rs 18 crore last year. The company’s net revenues rose to Rs 202 crore in FY14 compared with Rs 157 crore in the previous year.
Last month, Abu Dhabi Investment Authority, the sovereign wealth fund of the emirate of Abu Dhabi, picked up 1 per cent stake in the firm for Rs 3.88 crore via a block deal. Prior to this, India-focused private equity firm Helix Investments sold its remaining 4.4 per cent stake MT Educare for Rs 16.8 crore ($2.8 million) to BanyanTree Growth Capital through an open market transaction.
MT Educare’s shares closed at Rs 109.25 a unit, up 0.23 per cent on BSE in a strong Mumbai market on Tuesday.
(Edited by Joby Puthuparampil Johnson)
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