Zee Learn To Buy Majority Stake In MT Educare For Rs 200 Crore

Zee Learn Ltd. will acquire as much as 44.5 percent stake in MT Educare for a total consideration of Rs 200 crore, the company said in a notification to the stock exchanges today.

MT Educare will issue 3.2 crore shares to the Essel Group company on a preferential basis at a price of Rs 62.57 each.

The acquisition will trigger an open offer for an additional 26 percent stake in MT Educare, the price of which has been fixed at Rs 72.76 per share, according to a separate notification to the exchanges. Axis Capital has been appointed as the manager for the open offer.

Chhaya Shastri, non-executive director at MT Educare, speaking to BloombergQuint, said, the proceeds from Zee Learn’s infusion of capital will be used to pare debt, for marketing spends to bolster its application ‘Robomate’, and to fund a small acquisition.

As of Sep 30, 2017, MT Educare had a debt of close to Rs 196 crore on its books.

Zee Learn said the acquisition was strategic in nature. “The acquisition of MT Educare is aligned with our strategy to increase our footprint across segments in the education sector and consolidate our offerings through the digital route,” the company said in a press release.

The MT Educare scrip has been in focus of late, hitting an upper circuit in four out of the last five sessions.