Notable dealmaking points to breakthroughs in education

According to Quang Chau, managing partner of Rajah & Tann LCT Lawyers, 2024 has witnessed vibrant merger and acquisition (M&A) activity in Vietnam’s education sector, driven by a young and growing middle class increasingly willing to invest in quality education. Demand is particularly strong for K-12 schools offering international curricula and specialised training institutions, including those focusing on foreign language education. This presents opportunities for investors seeking stable growth in the promising Vietnamese market.

Notable dealmaking points to breakthroughs in education, photo freepik.com

“Many local education providers have strong facilities and systems but struggle with financial and operational challenges due to limited management expertise, uncontrolled diversification, and difficulties in school operations,” Chau explained.

“These weaknesses make them attractive acquisition targets for foreign investors. Partnering with or acquiring shares in these local players allows foreign investors to leverage local expertise, align with Vietnamese educational preferences, and enhance localisation – an essential factor for success in this market,” Chau continued.

Recent notable deals include Nutifood’s investment in Anne Hill International School in August, Vuihoc’s acquisition of The IELTS Workshop in May, and Excelsior Capital Vietnam’s investment in Kapla Education in April. Additionally, KKR-backed Malaysia-based Taylor’s Education Group is reportedly considering the acquisition of Vietnam-based Koala House.

Vietnam’s regulatory framework further supports this trend by allowing 100 per cent ownership of educational institutions, making market entry more accessible and acquisitions a more attractive alternative to greenfield investments. Greenfield projects often face significant barriers, such as complex licensing processes and high initial costs.

A report by FiinGroup in March highlighted the rapid rise in private education spending in Vietnam, drawing interest from both domestic and international investors. Foreign players have entered the market not only through acquisitions but also via greenfield projects and business collaborations, it said.

The Vietnam Innovation & Tech Report 2024, jointly released the following by the National Innovation Centre and Do Ventures, noted record-breaking investments in education in 2023. The sector saw a 107 per cent on-year increase, making it the second-most funded area with 67 deals, trailing only healthcare.

According to Huong Trinh, partner at BDA Partners, market consolidation and platform expansion will continue to draw in attention from strategic investors, private equity, and venture capital firms. Global and regional players are actively seeking acquisitions of local education providers to strengthen their presence in Vietnam and expand platforms across the region.

“Simultaneously, local players with foreign backing are pursuing bolt-on opportunities to consolidate the market further. K-12 education remains one of the most active subsectors, while growing demand for private higher education is driving interest in Vietnamese universities,” Trinh said.

Private equity and venture capital firms will continue to play critical roles in capitalising on the significant growth potential of Vietnam’s education sector, Trinh added.

“Financial sponsors typically focus on scaling operations to enhance efficiency and profitability, leading to increased investment in infrastructure, technology, and teacher quality. Moreover, with many education providers already backed by PE and VC firms, we anticipate more exits from financial sponsors in the coming years,” she explained.

Chau from Rajah & Tann LCT Lawyers further added, “M&A activity in the sector is expected to be driven by two key trends through 2025: the acquisition of distressed assets and the growth of edtech investments. Local educational institutions experiencing financial difficulties present unique opportunities for investors. Acquiring these existing assets, complete with all necessary licenses, offers foreign players a cost-effective market entry and the opportunity to revitalise established brands.”

“While regulatory hurdles and funding limitations persist, edtech remains a compelling area for investment, particularly in early childhood education innovations and specialised platforms like online grading tools. However, investors must navigate complex regulatory conditions around foreign ownership and operational requirements, which will heavily influence M&A strategies and deal structures,” Chau added.

The dual appeal of traditional education and edtech, combined with a favourable regulatory environment, positions Vietnam’s education sector as a strategic focus for both domestic and international investors.

These developments promise not only profitable returns but also a transformative impact on Vietnam’s education landscape, Chau added.

Australia and Vietnam foster education and training towards green economy An Australian education delegation is in Vietnam to take part in the Australia Southeast Asia Business Exchange (A-SEABX) Mission from September 25-27 in Hanoi and Haiphong, focusing on the transition to net zero and advancing green economy priorities.

Growing opportunities for Vietnamese students in New Zealand The Education New Zealand (ENZ), in collaboration with the New Zealand Embassy and Consulate General, hosted the 2024 New Zealand Education Fair in Hanoi on October 20.

Two Schools, One Vision: XCL World Academy and XCL American Academy to Merge XCL Education Group today announced the merger of XCL American Academy into XCL World Academy in August 2025.

PVFCCo supports educational development PetroVietnam Fertilizer and Chemicals (PVFCCo) continues to place a top priority on education alongside other social welfare activities.

The 16th Vietnam M&A Forum, held by VIR under the auspices of the Ministry of Planning and Investment, will take place at the JW Marriott Saigon Hotel in Ho Chi Minh City on Wednesday, November 27.

Themed “A Blossoming Market”, the event will feature in-depth discussions about emerging M&A opportunities across potential areas such as real estate, retail, technology, renewable energy, financial services, and logistics.

Activities for the 2024 edition include the main forum with leading Vietnamese and international speakers; honouring businesses with outstanding deals and the best M&A advisory firms in the 2023-2024 period;

and the official bilingual publication of Vietnam M&A Outlook 2024.