Varsity Education Said to Choose Banks for $296 Million IPO

Varsity Education Management Ltd., which provides lesson plans to Indian schools, has picked banks to arrange an initial public offering next year of as much as 20 billion rupees ($296 million), people with knowledge of the matter said.

The Hyderabad-based company appointed JM Financial Ltd., IDFC Ltd., JPMorgan Chase & Co. and Kotak Mahindra Bank Ltd. for the share sale, according to the people. Varsity Education, backed by South Asia-focused private equity firm New Silk Route, could be valued at about 100 billion rupees in the offering, the people said, asking not be identified because the information is private. 

Varsity Education is considering a listing at a time when India’s IPO market is rebounding. First-time share sales in the country have raised 69 billion rupees this year, compared with 35.3 billion rupees the same period in 2015, according to data compiled by Bloomberg.

In April, Vodafone Group Plc chose banks for a listing of its India business, which could raise as much as $3 billion and become the nation’s largest initial public offering, people with knowledge of the matter said at the time.

New Silk Route, which owns about 26 percent of Varsity Education, is among investors that plan to sell their stakes in the offering, the people said. The private equity firm invested in Varsity Education in 2011, according to its website.

Varsity Education recorded earnings before interest, taxes, depreciation and amortization of about 5 billion rupees in the year ended March, according to the people. It works with more than 500 schools, reaching about half a million students, according to one of the people.

The company had about 2 billion rupees of net income, the person said. Varsity Education declined to comment in an e-mailed statement. Ameya Sirur, an external spokesman for New Silk Route, said he couldn’t immediately comment.

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