Navis in $120m Australia deal

The Kuala Lumpur-based private equity firm has acquired Guardian Childcare Alliance, a childcare business, in a deal worth close to $120m.

Private equity firm Navis Capital Partners has acquired Australia-based Guardian Childcare Alliance from Wolseley Private Equity, in line with its focus on the education sector across the region, Philip Latham, Sydney-based partner at the firm, told Private Equity International. 

Latham declined to comment on the financial details of the transaction. But a source close to the matter told PEI that Navis took a roughly 90 percent stake in the business and the deal was worth about $120 million. 

Guardian Childcare is a private childcare operator. It provides daily care and education in 32 community early learning centres, 10 corporate early learning centres and 27 centres managed on-behalf of third party owners, a company statement said.

The investment is a continuation of Navis' emphasis on the education sector, Latham said.

“We've done a number of deals in education, investing in business schools in India and universities in Malaysia,” Latham said, adding that Australia's education sector is second only to the country's mining sector in terms of growth rate.

In places like Singapore, as well as Hong Kong, with very large urbanised work forces, the opportunity to provide childcare services at the place of work is a very big growth area for the future. That is probably where Navis will focus in terms of its international growth for this business.

Philip Latham, partner, Navis Capital Partners

While Navis is well-known for its focus on Southeast Asia, it has invested in businesses across Asia-Pacific in order to expand them into the sub-region.

Its expansion plans for Guardian will initially be in Australia, but Navis has identified the potential to expand into wider Asia, particularly the corporate early learning centre part of the business, Latham explained. 

“These are typically childcare centres at the bottom of a central business district building. It has an immediate market right on its doorstep – in the building itself – and that is the area we believe can grow into Southeast Asia,” he said.

“In places like Singapore, as well as Hong Kong, with very large urbanised work forces, the opportunity to provide childcare services at the place of work is a very big growth area for the future. That is probably where Navis will focus in terms of its international growth for this business.”

Navis' did something similar with its investment in Australian valve manufacturer Callidus Process Solutions, using its network in the region to find management with the specific expertise needed in the oil and gas industry to help expand the business into Southeast Asia, PEI reported earlier. The firm exited Callidus in July, gaining a 2.2x return multiple.

Navis Capital Partners is a pan-regional private equity firm based in Kuala Lumpur, Malaysia. The firm has about $3 billion in assets under management and is currently investing from its $1.2 billion Fund VI, according to PEI’s Research & Analytics division. The firm is expected to launch its seventh vehicle shortly, industry sources say.