Metropolitan College and IEK AKMI’s Majority Stake Sale to BC Partners

The Metropolitan College and the IEK AKMI Group are the leading providers of post-secondary education in Greece. The group’s network of 27 campuses and venues maintains a presence in all major Greek cities and caters to over 22,000 students across a broad range of disciplines. This transaction marks the second investment by BC Partners GR Investment LP, a special-purpose fund focused on investing in and supporting high-growth companies in Greece.

The transaction, which remains subject to regulatory approval, will see the Metropolitan College and the IEK AKMI Group joining forces with BC Partners to further cement their current leading positions in the field of post-secondary education in Greece, according to Calavros Law Firm.

Calavros Law Firm advised on the transaction with a team including partner Themistoklis Kloukinas and senior associate Xanthi Diamanti.

Lawyer Monthly had the pleasure to speak with Themistoklis Kloukinas at Calavros Law Firmto give us some further insight into this transaction:

Can you tell us about the role that you and your team at Calavros Law Firm played in advising on this deal?

Metropolitan College and the IEK AKMI Group is a long-standing client of Calavros Law Firm with whom we have worked closely over several years on a variety of matters across of all our core practice areas. We advised Metropolitan College and the IEK AKMI Group on all aspects of this strategic and complex multi-jurisdictional transaction. Our partner Themistoklis Kloukinas and senior associate Xanthi Diamanti led the transaction, providing full-scope support in the negotiations as well as targeted expert advice on corporate, commercial, real estate, litigation, competition and intellectual property law matters of this transaction.

What are your primary concerns when advising on a transaction of this nature?

Companies’ conversions and acquisitions are crucial to helping a business expand in size or territory and assisting them in diversifying risk. A primary concern is to build a framework for appropriate agreements by taking into account the most important objectives of the parties involved. A proper deal structure will result in a successful merger or acquisition agreement.

My main concern in regards to large acquisitions is the coexistence of the old and the new. The obligation of the legal advisors is to formulate the contractual texts in such a way that they do not leave any gap or need for interpretation during their application, which would create friction and disputes in the future. This is mainly the case when the old shareholders remain in administrative positions in the new scheme that will be formed after a takeover. In such a case, one must predict the balance between the old and the new mentality.

Another point that particularly concerns me is the realisation of the real legal status of the company under acquisition, as that will emerge from the legal audit. There, the experience of legal advisor is much needed. The simple recording of the findings of the legal audit without the legal advisor being able to diagnose the ’hidden‘ future consequences of this through their experience, leaves the contracting parties exposed to conflicts. On the contrary, the proper consideration of the legal audit and the projection of its consequences in the future is a great contribution of the legal advisor to the whole transaction.

My main concern in regards to large acquisitions is the coexistence of the old and the new.

Did you encounter any challenges during your work on the transaction? If so, how did you overcome them?

As in any such transaction, we had to identify red flags and obvious issues that would delay (or even break) the deal. The focus was to bridge any gaps, bring the parties to the same path and reach a faithful and healthy transaction with mutual interest. As in any such transaction, the parties have initially negotiated normally on a business level. Thus, each party has set its business goals.

However, the depiction of the will of the parties, when in fact more than one legal order is involved, often conflicts with rules of law, not because it is of an illegal nature, but because the provisions of each legal order have different regulations. Therefore, there lies the ability of the legal advisor to find, through the tools of supranational rules (international conventions and regulations), the answers and the ’bridge-building‘ of disputes. And in this particular international transaction, there was definitely a need to resort to such rules. Hence, the two sides resolved the above matter in good faith, because they were firmly looking forward to the realisation of the transaction.

What specialised skills and experience did you and your colleagues bring to the process?

Working closely with local and international businesses over several years on a variety of matters across of all our core practise areas, we have a deep knowledge of all aspects of businesses operation, which increases our ability to identify risks, find viable solutions and bridge gaps. I believe that in these types of transactions, the basic ability that the legal advisor should have is the combination of experience in litigation and a good knowledge of business operation. In case  the legal advisor possesses no such combination of knowledge and experience, I am sure that in such large international transactions, matters will remain ’unseen‘ and consequently unregulated at the time of the transaction, which may cause problems in the future. This ability also contributed to the completion of this particular transaction.

Would you say that your work on this deal fits the profile of Calavros Law Firm?

Calavros Law Firm is an active firm in the Greek M&A market, having advised lots of M&A deals in previous years. M&A is a core part of our practice. Our firm has developed this experience for about 40 years. One of our first projects was the sale of a minority stake in a large organisation operating in the field of telecommunications through an international tender, where I had the honour of participating in the team. Subsequently, the listing of its shares took place in the Greek stock exchange, but also in the New York stock exchange. Since then, the contribution of our law firm has continually been successful in projects either of acquisitions between Greek companies or between Greek and international companies, as well as in companies’ conversions.

Do you expect to work on similar transactions in the remainder of 2023 or beyond?

Other acquisition projects, as well as companies’ conversion in the field of construction and energy, are already running during this period.

What impact do you expect this deal will have on the field of post-secondary education in Greece?

The job market now requires skills and not just degrees. The post-secondary education market in Greece today remains low compared to other countries, but it has major prospects. The more advanced the product that will be provided by private schools, the more the private education in Greece will increase. Considering that the IEK AKMI and the Metropolitan College are institutions with 50 years of experience that have made huge investments over the years and possess excellent teaching staff and modern infrastructures, they will be the inspiration for other private educational institutions that operate in Greece to make investments, which will consequently improve the provision of services in private education and specifically in post-secondary education. I believe that the deal is also an investment for the new generation.

Do you have any further comments to make about your work on this deal?

We have been advising businesses in the educational industry for several years, covering all the aspects of their operation, including licensing and regulatory. We are an active team in the M&A market. This combination means that we can provide advice on education industry legal topics from a regulatory perspective and also advice on merger and acquisition matters.

Considering that our law firm, even before the above agreement, was responsible for the legal support of AKMI and the Metropolitan College, both at an advisory and litigation level, I can say that we can be proud of the services provided to them, since the legal audit, which preceded the transaction, had no negative findings.