CVC Capital Partners, a global private equity firm, has dropped its plan to invest in PSB Academy, a Singapore-based education provider owned by Intermediate Capital Group (ICG). The deal, which was reportedly worth around SGD 200 million (USD 147 million), was first announced in January 2022. However, after conducting due diligence, CVC decided not to proceed with the investment.
PSB Academy is one of the largest private education institutions in Singapore, offering a range of academic programs, including diplomas, degrees, and certificate courses. The institution has a strong reputation in the region and has partnerships with several international universities.
ICG, a London-based alternative asset manager, acquired PSB Academy in 2018 as part of its strategy to invest in education providers in Asia. The firm had been exploring options to exit its investment in PSB Academy, including a potential sale or initial public offering (IPO).
The decision by CVC to drop its plan to invest in PSB Academy is seen as a setback for ICG’s efforts to exit its investment. The deal was expected to provide a significant return for ICG, which has been investing in the education sector in Asia.
CVC’s decision not to proceed with the investment is reportedly due to concerns about the education sector in Singapore, which has been facing intensifying competition and regulatory challenges. The sector has also been impacted by the COVID-19 pandemic, which has affected student enrollment and revenue.
The failed deal is also seen as a reflection of the challenges faced by private equity firms in investing in the education sector. The sector is highly regulated, and investors need to navigate complex rules and regulations. Additionally, the education sector is subject to changing demand and supply dynamics, which can impact the financial performance of education providers.
Despite the setback, ICG is expected to continue exploring options to exit its investment in PSB Academy. The firm may consider other potential buyers or alternative exit strategies, such as an IPO. PSB Academy remains a strong and reputable education provider, and its ownership structure is not expected to impact its operations or academic programs.