Debenture Issuance

10/09/2025 – 07:28 PM

BELO HORIZONTE, Brazil – Afya Limited (Nasdaq: AFYA; B3: A2FY34), Brazil’s premier medical education group and medical practice solutions provider, has announced a significant financial maneuver aimed at optimizing its debt profile and funding strategic initiatives. The company’s wholly-owned subsidiary, Afya Participações S.A. (“Afya Brazil”), has greenlit the issuance of book-entry commercial notes, totaling R$1,500.0 million, through a private placement agreement with Opea Securitizadora S.A. (“Opea”), a Brazilian securitization corporation. This move is structured under Section 45 of Brazilian Law No. 14,195/2021.

The commercial notes are divided into two series. The First Series, amounting to R$500.0 million, and the Second Series, which will represent R$1,000 million. Both series are slated for issuance on October 15, 2025. The First Series will mature on October 15, 2028, while the Second Series has a maturity date of October 15, 2030.

Investment analysts note that the interest rates for these commercial notes are pegged to the Brazilian daily interbank deposit rate (Depósito Interfinanceiro), a benchmark for short-term lending between financial institutions in Brazil. The First Series offers a spread of 0.70% per year over this rate, while the Second Series provides a slightly higher spread of 0.85% per year, calculated based on a 252-business day year. This structure offers investors returns tied to a key Brazilian financial indicator.

To ensure the smooth completion of the issuance and increased confidence among investors, the commercial notes will be backed by guarantees from several of Afya’s key subsidiaries – Companhia Nilza Cordeiro Herdy de Educação e Cultura, Instituto de Ensino Superior do Piauí S.A., and Sociedade Educacional e Cultural Sergipe Del Rey Ltda. This multi-faceted approach to collateral adds further stability to the offering.

Afya intends to strategically deploy the net proceeds from this issuance, with a focus on several key areas. These include the potential full early redemption of Afya Brazil’s existing debentures, a move that would simplify its debt structure. Another planned usage case is the repurchase of the Series A perpetual convertible preferred shares, essentially prepaying the outstanding balance owed to SBLA Hold Co. This eliminates future dilution concerns. Furthermore, Afya plans to use a portion of the proceeds for broader liability management and optimization of the debt profile, indicating efficient operational oversight.

Analysts suggest that this financing move may strengthen Afya’s market position in the long term even though, as a disclaimer specifies, it does not constitute an offer to sell or solicit an offer to buy any securities.

About Afya Limited (Nasdaq: AFYA, B3: A2FY34)

Afya is a leading medical education group in Brazil based on the number of medical school seats. This medical education group delivers an end-to-end physician-centric ecosystem that serves and empowers students and physicians to transform their ambitions into rewarding lifelong experiences from the moment they join us as medical students through their medical residency preparation, graduation program, continuing medical education activities and offering medical practice solutions to help doctors enhance their healthcare services through their whole career.