Education

Dubai school to be rebranded after falling out with global school group

An Indian school in Dubai has parted ways with the international education group it belonged to.

Afshan Ahmed

April 22, 2012

DUBAI // An international school group plans to open a new campus in the emirate to compete with a school that recently ended a contract with it.

Score Plus Education says a dispute led to the termination of their agreement in March with Singapore's Global Schools Foundation (GSF), which is responsible for 20 Global Indian International Schools (GIIS) worldwide.

The Dubai school, which started with 450 pupils in 2010 and now educates about 1,000, has until next year to rebrand.

Management at the school wrote to parents last week to inform them about the separation from GSF, and has already rebranded the kindergarten section Ambassador Kindergarten.

Full ties with the GSF brand will end by April 2013, after the notice period has been served.

Kamal Kalwani, chief operating officer at Score Plus Education, said the differences with GSF arose when it asked for a controlling share in the school.

"It started last year in October when the franchiser came for a board meeting and our plan for a new campus was shared. Then in October they said they wanted a controlling stake."

But GSF disputed that claim, stating: "No binding offer was made by us to buy the school and the key reason is linked to the franchisee's failed attempts to procure school land from the regulators in Dubai and Abu Dhabi without the knowledge and consent of the Singapore foundation.

"The franchisee called for a meeting with GSF in early 2011 and told us he would launch his own brand of schools in Dubai under another family members name. GSF drew his attention to his contractual obligation not to enter into competing business."

A group spokesman said it was "pained" by the turn of events. "We are acutely aware that we need to pull out all stops to get a school up and running here in Dubai… to try to provide a GIIS option which will ensure there is no discontinuity to students going forward."

The school has held meetings and set up online discussion groups to reassure parents there will be no change in the academics or other operations.

Vivek Agarwal, whose child is in KG1, said there was no difference with the quality so far. "We came here because of the brand, but also because we have friends who told us the school here is good."

"The teachers are the same and that is where the quality lies.

Another parent, who said she was also drawn to the reputation of the school group, said she will wait to see how things pan out in the coming years.

"My daughter is happy in the school now and that's what matters. I have not decided what I will do later but it does not seem to be a big issue if the people here remain the same."

Mr Kalwani said GSF had very limited involvement in the school's operations and that a name change will not affect the education or operations of the school.

"We were the first to start the ICSE in the school group. Everything from pedagogy to teachers' development and facilities has been our input.

"The brand name may have gotten the parents through the door but the word of mouth appreciation is what led to our growth.

"Parents must know that the signboard may have changed but nothing else has."

GSF representatives said they provided the system to set up the school. "He had no prior experience of running schools, and used GSF intellectual properties and system and processes to create a school," said a spokesman, who added that they were also involved in the initial staff and teacher training.

The school has retained its principal and all its teaching staff.

Winston Gomez, the principal of the school, said he had decided to remain on in his post. "It's the same team here and we are working to evolve our curriculum."

The Knowledge and Human Development Authority (KHDA), which regulates private schools in Dubai, did not wish to comment on the dispute but acknowledged Ambassador Kindergarten as a new school.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”