In the realm of Brazilian education, giants Cogna and Yduqs are exploring the possibility of a merger, reigniting discussions that are fraught with challenges. The main point of contention lies in Cogna’s insistence on including its basic education division in the deal, a stance that Yduqs does not share. This disagreement is fueled by the companies’ similar sizes, with Cogna’s basic education segment playing a pivotal role in maintaining equilibrium.
Cogna boasts a net revenue of nearly R$6 billion ($1.09 billion) and an EBITDA of R$1.8 billion ($327 million) in 2023, whereas Yduqs achieved a revenue of R$5.1 billion ($927 million) and an operating profit of R$1.6 billion ($290 million). The involvement of financial advisor Morgan Stanley for Yduqs adds a layer of complexity to the negotiations, especially with private equity firm Advent, a key Yduqs shareholder, in the mix.
The Brazilian education landscape is evolving, with players like Vitru leading the distance learning segment and exploring potential business combinations with various educational groups. Despite a revenue decline in recent years due to shifts in government student financing programs, the market remains dynamic, with key players navigating challenges and seeking growth opportunities. Stay tuned for further updates as these education powerhouses maneuver through this shifting landscape.
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