DeVry Education Group, Inc.’s DV announced that its subsidiary, DeVry Brasil has acquired 96.4% of the Brazilian education company, Grupo Ibmec Educacional S.A. (Ibmec) for 699 million Brazilian Real. The acquisition is expected to strengthen DeVry’s presence in Northern Brazil, where the company already offers courses to about 15,000 students.
Ibmec has campuses in Rio de Janeiro, Brasilia, Belo Horizonte and Campinas. The educational company primarily offers career-oriented programs in the fields of business, law and engineering.
Post the acquisition, DeVry will invest in the distribution of Ibmec’s programs through the DeVry Brasil network, apart from opening new campuses and enhancing corporate education. The Brazilian institution anticipates synergies from DeVry’s high-quality academic practices, and infrastructure and technology upgrades, among others.
DeVry has been aiming to expand its business through international acquisitions as part of its long-term growth strategies.
As of first-quarter fiscal 2016, the company completed eight acquisitions in Brazil, whose average expected return is more than 20%. The education sector in Brazil is supported by a growing middle class and public policies that target education as a tool to drive the economy and improve the standard of living. As such, acquisitions in Brazil offer long-term growth opportunities for the company.
Such acquisitions enable DeVry to grow and diversify into new program areas, levels and geographical locations, and build high-quality brands to compete in an increasingly competitive market.
Over the near term, DeVry is looking for acquisitions in the fields of health care, professional and international education.
DeVry carries a Zacks Rank #3 (Hold).
Stocks to Consider
Some better-ranked stocks in the education industry include Lincoln Educational Services Corporation LINC, New Oriental Education & Technology Group Inc. EDU and TAL Education Group XRS, each sporting a Zacks Rank #1 (Strong Buy).
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