Afya Limited Announces Closing of the Acquisition of Centro Universitário São Lucas

Rhea-AI Summary

Afya Limited (Nasdaq: AFYA) announced the acquisition of Centro Universitário São Lucas (UniSL) for R$341.6 million, enhancing its medical education capacity. This acquisition provides Afya with 182 additional medical school seats, increasing its total to 1,866. In 2019, UniSL generated gross revenues of R$227.5 million, primarily from health-related programs. The payment structure includes 70% upon closing and the remaining 30% in three installments, potentially increasing by R$80 million if additional seats receive government approval.

Positive

• Acquisition of UniSL enhances Afya's medical education capacity with 182 new medical school seats.
• UniSL generated R$227.5 million in gross revenue in 2019, boosting Afya's financial profile.
• Potential for an additional R$80 million payment related to further seat approvals.

Negative

• The acquisition includes assuming UniSL's estimated net debt of R$140.1 million.
• Initial 70% cash payment required at closing could strain Afya's liquidity.

NOVA LIMA, Brazil, May 05, 2020 (GLOBE NEWSWIRE) -- Afya Limited, or Afya (Nasdaq: AFYA) in addition to the Press Release released by the Company on February 21, 2020, today announced the closing of its acquisition, through its wholly-owned subsidiary Afya Participações S.A., of 100% of the total share capital of Centro Universitário São Lucas, or UniSL.

UniSL is a post-secondary education institution with governmental authorization to offer on-campus, undergraduate courses in medicine in the State of Rondônia. UniSL also offers other health related undergraduate degrees. In 2019, UniSL’s gross revenue totaled R$227.5 million, and approximately 65% of its gross revenue came from health related programs.

The aggregate purchase price is R$341.6 million, including the assumption of estimated net debt of R$140.1 million, of which: (i) 70% is payable in cash on the transaction closing date, and (ii) 30% is payable in cash in three equal installments through 2023, adjusted by the CDI rate.

The acquisition will contribute 182 medical school seats to Afya, increasing Afya’s total medical school seats to 1,866. There are 100 additional seats still pending approval which, if approved by the Ministry of Education, will result in a potential additional payment of up to R$80 million, adjusted by the CDI rate.

About Afya

Afya is a leading medical education group in Brazil based on number of medical school seats, delivering an end-to-end physician-centric ecosystem that serves and empowers students to be lifelong medical learners from the moment they join us as medical students through their medical residency preparation, graduation program, and continuing medical education activities.

Contact: Investor Relations: ir@afya.com.br

FAQ

What is Afya's acquisition of UniSL about?

Afya acquired Centro Universitário São Lucas to enhance its medical education capacity, adding 182 new medical school seats.

How much did Afya pay for the acquisition of UniSL?

The total purchase price for UniSL is R$341.6 million.

What revenue did UniSL generate in 2019?

UniSL's gross revenue totaled R$227.5 million, with a majority from health-related programs.

How will this acquisition impact Afya's total medical school seats?

The acquisition will increase Afya's total medical school seats to 1,866.

Are there any additional payments expected from this acquisition?

Yes, if 100 additional seats are approved, Afya may pay up to R$80 million, adjusted by CDI rate.