UAE-based Shariah compliant asset manager Gulf Islamic Investments (GII) is looking forward to what it can contribute towards accelerating the growth of GEMS Education, having completed the US$2 billion-valued acquisition with consortium partner Brookfield Asset Management of Canada.
GII Co-founder and co-CEO Pankaj Gupta told IFN Investor that GII brings three major components to help propel growth of the world’s largest kindergarten-to-12th grade private education provider, headquartered in Dubai.
“We are an active player in Saudi Arabia and GEMS Education has not yet gone into Saudi Arabia proper for its chain of schools.” GEMS Education is anticipated to received receive over 140,000 students across its 46 schools in the UAE and Qatar when the next term starts in September 2024.
GII has a significant real estate portfolio across the GCC region and Pankaj said the firm is in a good position to source and obtain locations for GEMS to operate new schools. The final piece is GII’s stake in augmented and virtual reality (AR/VR) education provider zSpace.
Based in California, zSpace is among the largest AR/VR platforms in the world in the education field, being present in 25,000 schools. Pankaj said GEMS Education “is extremely excited about zSpace and we’re working to bring to its curriculum a blended solution with AR/VR”.
Having filed a US$30 million IPO for a NASDAQ listing, Pankaj said zSpace is already making a real difference in the US – where a training school reduced its mechanic class’ needs to just two cars annually, from 20 before.
“Think of teaching biology to students, where you don’t have to use live rabbits or rats or more as lab animals. Similarly, when you are doing some construction. It’s an amazing technology. Whatever you can do in real life, you can do so virtually.”
With these value-adding components, Pankaj is confident GEMS Education will be a very strong candidate for an IPO as it is a defensive business with a consistent income stream and possessing a strategic asset. “I think it has everything that a market will look for.”
Work on the GEMS Education deal began around a year ago when GII was invited by Brookfields to participate, while both parties were in talks over the majority stake in GII’s real estate platform in UAE. Seeing synergy, others who joined were Marathon Asset Management and the State Oil Fund of the Republic of Azerbaijan.
“When we started doing due diligence on GEMS Education, we realised this is par excellence business built over 65 years. The business has consistently done well.”
Pankaj also noted that Malaysia’s sovereign wealth fund Khazanah Nasional exited and CVC Capital Partners reduced its stake in GEMS Education with 18% returns. “This shows the intrinsic strength of the business.” Expressing gratitude at how smoothly and quickly the deal was completed, especially with fewer work days during the Ramadan to Hajj period, Pankaj said the deal attracted lots of positive attention to show “the GCC region offers significant opportunities of global nature and global quality to invest”.
