Pacific Equity Partners is being tipped as the likely winner in the auction for Torrens University owner Laureate International Universities.
The revelation comes after its Australian rival BGH Capital left the race before making a final bid at the weekend. Final bids were due on Monday.
Kohlberg Kravis Roberts is also out of the contest, while Baring Private Equity is also thought to have left the race, with some questioning whether the process could be placed on hold as parties assess the impact of the coronavirus.
However, US-based Strategic Education is understood to have made a final offer for the Laureate operations.
PEP is advised by Jefferies.
Fears surrounding the coronavirus are taking their toll in education, although Navitas, owned by BGH, and Torrens, which accounts for a small amount of the revenue for Laureate’s Australia and New Zealand assets, are thought to have few students from China.
In January, The Australian reported that 10 universities faced the loss of $1.2bn in fees from about 65,800 students at risk of cancelling their first semester courses because they were stranded in China due to the Morrison government’s coronavirus travel ban.
The latest figures from the department of education in 2018 showed that of Torrens University’s 7900 students, 6000 were overseas students, the assumption being that a sizeable number would be from India and Nepal.
Based in Baltimore, it is selling its operations through Goldman Sachs. Globally, it owns and operates universities, with more than 150 campuses in 10 countries last year.
In Australia, it owns Torrens University and Think Education, along with the Media Design School in New Zealand.
In delivering its full-year results last week, Laureate said its annual adjusted earnings before interest, tax, depreciation and amortisation from Australia and New Zealand was $US32m ($49m), up from $US28.4m in the previous corresponding period.
PEP has invested in the education sector in the past.
It sold part of Academic Colleges Group in 2018 to Inspired Schools in Britain for about $600m. The sale consisted of the secondary schools within the business, and the remaining part of the operation consists of the tertiary education arm, which has been rebranded Up Education.
PEP bought Academic Colleges Group in 2015 for at least $NZ500m and had plans to roll out the business internationally once it had grown further across the Tasman.
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