A consortium of Abu Dhabi state-backed entities is weighing an offer for a stake in Dubai-based GEMS Education, one of the world’s largest private school operators, people familiar with the matter said.
Wealth fund ADQ and real estate developer Aldar Properties PJSC are among those exploring a joint bid for part of private equity-backed GEMS, the people said, asking not to be identified discussing confidential information. Aldar, which is backed by the Abu Dhabi wealth fund Mubadala Investment Co., already manages a schools business called Aldar Education.
The education provider is owned by its founder Sunny Varkey and buyout firm CVC Capital Partners, who have been exploring options for their stakes in the business. Any sale may value GEMS at about $6 billion, Bloomberg News reported last month.
Deliberations are ongoing and there’s no certainty that the Abu Dhabi funds will decide to make an offer for a stake in GEMS, according to the people. Representatives for ADQ, CVC and GEMS declined to comment.
A spokesperson for Aldar said the company “continues to assess opportunities to expand its platform in core and complimentary industries” in line with its growth strategy, declining to comment on specific transactions.
Parents in the UAE are among the world’s biggest spenders when it comes to educating their children, contributing to a glut of private schools. Dubai’s emergence as a post-Covid haven has drawn expatriates to the emirate, helping prop up demand.
GEMS, which traces its roots back about 60 years, operates more than 60 schools teaching over 130,000 students across the Middle East and North Africa. It also has schools in Asia, Europe and North America, according to its website. CVC bought its stake in the company in 2019.
Varkey held talks to sell some of his stake in GEMS in 2020, but struggled to find buyers amid the pandemic, with schools and universities shutting down as part of global lockdowns. The firm had also considered a stock market listing in 2019, but those plans were scuppered by Dubai’s move to unexpectedly freeze school fees.
The institution’s owners are working with Morgan Stanley and Goldman Sachs Group Inc. to identify buyers, people familiar with the matter said previously. They’ve also been weighing an initial public offering as a potential exit route though the preferred option is a sale, they said.
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