Here’s a bold statement: Brazil’s leading medical education group, Afya Limited, is making moves that could reshape its financial landscape—and it’s not without controversy. But here’s where it gets controversial: the company is repurchasing its own shares and repaying debts in a way that’s raising eyebrows and sparking questions about its long-term strategy. Let’s break it down in a way that even beginners can follow.
Afya Limited (Nasdaq: AFYA; B3: A2FY34), the powerhouse behind Brazil’s medical education and practice solutions, announced a significant financial maneuver. The company has entered into a Share Repurchase Agreement with SBLA Holdco LLC, an affiliate of Softbank, to buy back all 150,000 of its Series A Perpetual Convertible Preferred Shares. Each share has a nominal value of just US$0.00005, but collectively, they’re worth a staggering R$831.6 million. The deal is set to close on November 3, 2025, and Afya plans to cancel these shares entirely once the transaction is complete. And this is the part most people miss: this move could signal a shift in how Afya manages its capital structure, potentially freeing up resources for future growth—or is it a defensive play? We’ll explore that later.
To put this in perspective, Afya originally issued these shares to Softbank on April 26, 2021, for the equivalent of US$150.0 million in Reais. Now, by repurchasing them, Afya is essentially unwinding a major investment—a decision that’s sure to spark debate among investors and analysts alike.
But that’s not all. Afya also revealed that it fully repaid R$500.0 million in debentures issued by its subsidiary, Afya Participações S.A. (Afya Brazil), on October 22, 2025. These debentures, issued on December 16, 2022, had a maturity date of January 15, 2028, with principal payments split into two equal installments due in 2027 and 2028. By settling this debt early, Afya is reducing its financial obligations ahead of schedule—a move that could improve its balance sheet but also raises questions about its cash flow priorities.
Here’s the controversial part: Afya is funding both the share repurchase and debt repayment with proceeds from commercial notes issued by Afya Brazil on October 15, 2025. This strategy of essentially refinancing debt to pay off other obligations is a double-edged sword. On one hand, it demonstrates financial agility; on the other, it could be seen as kicking the can down the road. What do you think? Is this a smart financial strategy or a risky gamble?
Afya’s broader mission is to create an end-to-end ecosystem for medical professionals, from students to seasoned physicians. With the largest number of medical school seats in Brazil, the company supports doctors throughout their careers, offering everything from residency preparation to continuing education and practice solutions. This latest financial move could either strengthen its position or introduce new challenges—only time will tell.
Thought-provoking question for you: Is Afya’s decision to repurchase shares and repay debt a sign of financial strength or a strategic distraction? Share your thoughts in the comments—we’d love to hear your take on this complex and potentially game-changing move.
