Global private equity funds KKR and Kaizenvest are investing P4.5 billion in PHINMA Education Holdings Inc., a leading private higher education firm owned by conglomerate PHINMA Corp.
PHINMA said in a disclosure to the stock exchange Wednesday its education group signed an investment agreement with Phoenix Investments II Pte. Ltd, an investment fund managed by KKR, and Rise Edu Pte. Ltd., an investment fund managed by Kaizenvest (Kaizenvest III).
Under the agreement, PHINMA Education will issue P4.5 billion worth of new common shares to these funds.
These funds also signed an agreement to acquire the shares in PHINMA Education owned, directly or indirectly, by the Asian Development Bank (ADB), Nederlandse Financierings- Maatschappij voor Ontwikkelingslanden N.V. (FMO), and Kaizen Private Equity II Pte. Ltd. (Kaizenvest II).
Post transaction funds managed by KKR and Kaizenvest III will respectively own, directly or indirectly, 30.67-percent and 3.73-percent stakes in PHINMA Education.
Meanwhile, the ADB, FMO and Kaizenvest II will no longer be, directly or indirectly, shareholders of the company. PHINMA, which owns a 75-percent stake in the company, will continue to be the majority shareholder of PHINMA Education after the entry of the new investors.
PHINMA chairman and chief executive Ramon del Rosario, Jr. said the partnership with KKR puts the company in a better position expand its operations in the Philippines and in Indonesia.
Under the investment agreement, KKR will be entitled to three board seats in the 11-man board of PHINMA Education.
The transaction is expected to close in the third quarter of 2024, subject to customary regulatory approvals, including that of the Philippine Competition Commission.
PHINMA Education, established in 2004, seeks to provide quality, affordable tertiary education. It is one of the largest private higher education groups in Southeast Asia, serving around 150,000 students through its fast-growing network of colleges and universities, including nine in the Philippines and one in Indonesia.
KKR is investing in PHINMA Education from its Global Impact Fund II, which targets companies whose core business contributes meaningfully towards one or more of the United Nations Sustainable Development Goals (SDGs).
“PHINMA Education’s mission of delivering quality, affordable education to underserved communities aligns strongly with our Global Impact strategy. We will look to leverage KKR’s deep experience investing in education companies globally to support the management team’s vision to scale the company and become a leading education platform across Southeast Asia,” said George Aitken, managing director and head of global impact for Asia Pacific at KKR.