The Education Company Vasta is About to go Public on the Nasdaq
The education company Vasta, a Cogna subsidiary (formerly Kroton), is about to go public on the Nasdaq technology stock exchange in the United States, which has had an impact on Cogna’s shares in Brazil. Since July 6, when Vasta carried out a public protocol to register the initial public offering (IPO) with the SEC (Securities and Exchange Commission), Cogna’s shares have risen more than 30%.
The movement is explained in part by Vasta’s potential to expand the holding company’s performance in basic education, and thus reduce the importance of higher education in the business. Until now, Cogna has always had higher education as its main business. The company knew how to take advantage of the peak of Fies, the federal student financing program, which in 2014 granted more than 700 thousand loans.
But the program has been dehydrated in recent years, taking the company’s margins along. The impact of this reduction for the sector was the subject of a report published in EXAME. The change made Cogna turn its eyes to basic education, and Vasta is the main result of this movement.
Vasta offers content to schools through education systems, such as Anglo and Pitagoras, with digital and printed material. It also has a digital study platform, Plurall, widely used by schools in the new coronavirus pandemic. It also has solutions for complementary education, such as language teaching.
On another front, it offers management services to partner schools. This division, called the Digital Platform, is a major bet for the company to grow. It currently offers a service called Livro Facil, an e-commerce for the sale of educational content, which also functions as a material distribution center.
In the document submitted to the SEC, Vasta states that its goal is to become a “partner for everything” in private schools. To this end, the objective is to expand services aimed at school administration, including management system, digital marketing, scholarship marketplace and online enrollment service.
The company highlights that the business division focused on school administration has been growing rapidly. It was 8% of the business in the fourth quarter of 2018, when it was implemented, increased to 11% in 2019, and accounted for 19% of revenues in the first quarter of 2020.
For analysts, Vasta’s performance potential should increase the importance of basic education in Cogna’s revenue. Last year, the segment represented 29% of the holding’s revenue, compared to 12% in 2018.
Vasta is About to go Public on the Nasdaq - /10
The education company Vasta, a Cogna subsidiary (formerly Kroton), is about to go public on the Nasdaq