23S Capital announces investment in Vitru Educação, Brazil’s largest digital education group

São Paulo, September 28, 2023 – 23S Capital, an asset manager focused on creating sustainable and long-term value, announces its investment in the largest private distance learning institution in Brazil and a national reference in on-campus education: Vitru Educação (Nasdaq: VTRU). The transaction involves the purchase of approximately 10% of the company, with participation in the company’s Board of Directors.

Vitru is the second investment in a recently launched fund of US$ 700 million, created from the strategic partnership between Votorantim and Temasek, with the objective of investing in high-growth companies in Brazil.

The investment was motivated by the accelerated growth and differentiated positioning of Vitru, the only listed player with a real focus on digital education, a booming segment in the education sector. “In addition to its leading position in a high-growth segment, Vitru has several competitive differentials that contributed to the investment thesis. The high-quality education it offers, the excellence of its management team, robust infrastructure of the hubs, cash generation, as well as the focus and leadership in the hybrid digital distance learning are among the differentials we have identified,” commented Matheus Villares, CEO of 23S Capital. “Also, the digital education offered by Vitru helps to democratize education in Brazil, since it allows a population that would not normally have access to university, for financial and logistical reasons, to be able to study and pursue a better quality of life,” he added.

The total number of undergraduate distance learning students in the Brazilian private market more than doubled between 2016 and 2021, increasing from 1.4 million to 3.5 million. Meanwhile, Vitru has outgrown the market, reaching the lead in the number of distance learning undergraduate students, with 837,000 students enrolled in this modality in June 2023.

23S Capital will have the right to appoint a member to the company’s Board of Directors, in order to help the company to continue to grow its share in the digital learning market and explore new growth avenues.

The new director will replace one of the two members appointed by Vinci Partners, a Private Equity manager that invested in Vitru in 2016. The asset manager added significant value to the company during the period and will remain a shareholder in the company.

“Since our investment in 2016, we have been able to contribute, together with an exceptional management team, to Vitru’s rise from 5th place to 1st place in undergraduate distance learning in Brazil, multiplying its student base by more than 7x and delivering unprecedented growth in recent years. This performance crystallizes what we see as the sustainable competitive edges of Vitru’s business, corroborated by the company’s ability to attract quality partners to its capital base,” commented Carlos Eduardo Martins, partner, and co-head of the private equity strategy at Vinci and chairman of Vitru’s Board of Directors.

“Vitru made its debut on the capital market three years ago, when we had 608 hubs and almost 290,000 students. By June 2023, we had more than 900,000 students, served by Uniasselvi and Unicesumar brands in more than 2,300 hubs across the country. This growth and our historical focus on quality education attract qualified investors such as 23S Capital, which reinforces our responsibility to democratize access to education in Brazil as well as the potential of the digital and quality education segment. We are thrilled and honored with the arrival of 23S Capital to our renowned team of relevant shareholders”, commented William Matos, CEO of Vitru.

The closing of the transaction is subject to the fulfillment of certain conditions precedent.

Information for the press

About 23S Capital
Announced in August 2022, 23S Capital’s US$ 700 million fund is the result of a partnership between Votorantim and Temasek to invest in high-growth companies with expansion potential. The partnership represents the convergence of local knowledge, sector-specific skills, a global network of connections and financial capacity to leverage the next generation of Brazilian companies. With a history of more than 100 years in Brazil, Votorantim is one of the largest investment companies in Latin America, with stakes in companies across a range of economic sectors, including construction materials, financial services, renewable energy, metals and mining, real estate investments, infrastructure, and agribusiness. Temasek is an investment company with more than R$1 trillion (US$287b as of March 31, 2023) in assets under management based in Singapore. Find out more at www.23scapital.com.br

About Vitru
Vitru is the leading distance learning group in the digital education market in Brazil. Through its investee companies, Vitru provides a complete pedagogical ecosystem focused on the hybrid distance learning experience, which includes presential meetings for undergraduate and continuing education students. Vitru’s mission is to democratize access to education in the country through a digital ecosystem and empower each student to create their own success story.

About Vinci Partners

Vinci Partners is a reference in alternative investments in Brazil, specialized in asset management, wealth management and financial advisory, with an independent and unique model in the country. Founded in 2009 by a group of managers with extensive experience in the financial markets, Vinci has approximately R$65 billion under management and is listed on Nasdaq under the ticker VINP.