Educor is unbundling its education arm and will focus on developing and growing its IT recruitment section. The company estimates the deal to be worth about R1 billion.
Educor will form a new company into which it will unbundle its existing education operations. Naspers will own 40% of this new company.
The education division will take Naspers on board as a strategic shareholder following the purchase of National Private Colleges from Naspers for R100 million worth of shares in the new education company.
Educor will then sell a further 29.7% of the new business to Naspers for R288 million, giving Naspers a 40% holding in the new Educor.
Educor intends to make use of Naspers` connections with M-Web and Multichoice to deliver private education into new markets. This new company will be listed separately in the education and staffing sector.
Naspers MD, Koos Bekker, who becomes a non-executive director of the new Educor, says: "We regard it as a major opportunity to work with the people of Educor in achieving this dream. We will have to develop it jointly, step-by-step, as we developed M-Net in pay TV, MTN in cellular telephony and M-Web on the Internet."
"With our decision to reposition the group, shareholders will be able to participate in the growth of Educor`s two core businesses," says Educor chief executive Charles Rowlinson. "The focused education group, which will retain the Educor name as a new listed company, will have a greatly enhanced electronic delivery capability with Naspers as a strategic shareholder.
"The recruitment and IT interests which are retained in a company that will be appropriately named in the near future, will gear themselves for the convergence of IT services and solutions."
Rowlinson says the IT and recruitment business is expected to have gross annual revenues of around R1 billion and a market capitalisation (share price multiplied by the number of shares on issue) of around R2 billion.
Educor shareholders will be informed of the number of new Educor shares they will receive in the unbundling.
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