MindChamps PreSchool has entered into a joint venture with investment firm Foundation Corporation to set up a fund to acquire pre-schools in the Gulf Cooperation Council (GCC) countries and operate them under the MindChamps brand.
The GCC comprises Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.
The GCC PreSchool Fund aims to raise an initial tranche of around US$50 million to US$100 million (S$72 million to S$143 million) by selling interests to the fund's limited partners.
It is intended to have an initial term of six years, the firm said in a regulatory filing yesterday.
These limited partners are understood to comprise mainly third-party investors, but also MindChamps and Foundation, both of which may invest.
The fund will have an initial share capital of US$1 million, with MindChamps owning 50 per cent and Foundation owning the other half.
The general partner will receive recurring management fees from the fund as well as "carried interest" depending on performance. MindChamps will get profits from the general partner's operations based on its 50 per cent holding.
MindChamps and Foundation will also incorporate a new company to be the master franchisee of MindChamps in the GCC countries.
This company will oversee newly established or acquired pre-schools under the MindChamps brand in the GCC countries. It will have an initial share capital of US$4 million, with MindChamps and Foundation each owning half of the issued share capital.
MindChamps will receive licence fees, royalties and profits from the operations of the master franchisee company based on its 50 per cent shareholding.
It will also receive royalties from franchised pre-schools and returns from investment in the GCC PreSchool Fund.
Foundation is a global investment firm which invests in healthcare and education in the GCC countries and India.
Mainboard-listed MindChamps closed flat at $0.24 yesterday.
THE BUSINESS TIMES
