There is yet another deal in the test preparation space, which is proving to be an attractive niche for private equity play.
Nadathur Group, the family office of Infosys co-founder N S Raghavan, has made an investment in test preparation firm Career Point Infosystems Ltd. The firm is based out of Kota in Rajasthan, and provides coaching for entrance examinations for engineering
institutions like Indian Institute of Technology (IITs) and medical colleges.
Sources familiar with the development told VCCircle that the investment is in the sub-$10 million range. The deal comes months after Career Point raised $10.35 million (Rs 50 crore) from Franklin Templeton Private Equity Strategy in July 2009.
An e-mail sent to Vishal Jain, managing director of Nadathur's family office Ethos Advisors, did not elicit any response. o3 Capital was the advisor on the transaction.
Career Point had 24,000 enrollments last year and has a presence in 29 cities through a mix of company run as well as franchisee operations. Besides test preparation, Career Point has also entered into traditional education areas like Kindergarten to Grade-12 (K-12
School) and higher education (university).
Career Point has also tied up with Kota's Global Public School to provide Synchro-School Programme. This programme integrates studies for academic and competitive examinations, starting from Class VIII. Global Public is owned by Career Point through a trust.
The group also has a management school called ProSeed Business School, which offers courses like BBA (Bachelors in Business administration), MBA (Masters in Business administration), Hospitality and Hotel Management.
There have been several investments in the test preparation space including Matrix Partners India’s Rs 100-crore investment in FIITJEE Ltd, which also provides training for engineering entrance exams. Another was Milestone Religare's Rs 25-crore investment in IMS Learning Resources.
India's education sector has continued to attract investments this year as PE & VC players look for their share in a large non-cyclical opportunity. The private spending on education is increasing by 14% CAGR and is expected to reach $80 billion by 2012, says an IDFC-SSKI report.