Zee Learn may pick up 42.78% in MT Educare

Subhash Chandra-controlled Zee Learn is in talks with MT Educare, a Mumbai-based company that runs the popular Mahesh Tutorials coaching classes, to buy a controlling stake in the company, in a growing sign that a wave of fresh capital is triggering larger consolidation in the educational services space.

Zee initially plans to buy the entire promoter block of 42.78% and will make an open offer for another 20% stake, multiple sources told ET. Institutions and public shareholders own the remaining 57.22%. MT Educare, which went public in 2012, is a leading education services company that prepares students for competitive examinations. It had a market capitalisation of Rs 324 crore as on Friday. At current valuations, Zee will have to pay Rs 140 crore for a controlling stake in the company.

“Zee Media has had multiple rounds of formal negotiations with MT Educare management. A transaction is highly likely before fiscal-end,” said one of the sources.

When contacted, Zee declined to comment. MT Educare chairman and CEO Mahesh Shetty denied any transactions are in the offing.

“I cannot comment on this. As of now, there is no transaction,” he told ET. A formal mail sent to MT Educare investor compliance officer, Dinesh Darji on Thursday, remained unanswered till the time of going to press. Founded in 1988 as alternate tutorial classes, MT Educare has 276 centres across 166 cities and over 1.5 lakh students in FY17 alone, as per its investor presentation in September.