MATERIAL FACT

Belo Horizonte, June 2, 2016 - KROTON EDUCACIONAL S.A. (BM&FBovespa: KROT3; OTCQX: KROTY) ("Company" or "Kroton"), in compliance with Instruction n.° 358/02 issued by the Brazilian Securities and Exchange Commission ("CVM"), in light of the recent information disclosed in the press, hereby informs the market of the following.

The Company has been conducting, confidentially, internal studies regarding a potential combination of its business and that of Estácio Participações S.A. ("Estácio") and believes such business combination would bring benefits to both companies, their businesses, students, shareholders and other stakeholders. The transaction has a strong strategic rationale due to high geographic complementarity, significant potential for synergies and efficiency gains (based on the analysis of publicly-available information), and particularly, the strengthening of the investments in quality of their educational services.

The potential combination would involve only shares issued by Kroton as consideration, and no cash payment.

To determine the values of the companies in a potential business combination, the Company considers, based on internal studies with support of our advisers, an exchange ratio1 of 0.977 common share issued by Kroton for each common share issued by Estácio, based on the volume weighted average price traded on BM&FBovespa for the shares of each company in the 30 trading sessions immediately prior to this material fact. Based on such exchange ratio, following the required share issuance, shareholders of Estácio and shareholders of the Company would each respectively hold approximately 15.7% e 84.3% of the shares of the Company.

It is important to highlight, however, that there are currently no ongoing negotiations with any member of Estácio’s management, nor has any agreement been executed or proposal been made between the companies (and, therefore, we cannot comment on the progress or conclusion thereof).

Kroton’s management will endeavor its best efforts to immediately engage Estácio’s management in order to reach an economic and corporate structure for the transaction described herein involving the companies, with the purpose of, if applicable, submitting such transaction to the respective boards of directors and shareholders’ meetings and to the public authorities.

Kroton has hired Banco Itaú BBA as its financial advisor and Barbosa Müssnich & Aragão (BMA) as its legal counsel for the potential transaction.

Kroton reaffirms its commitment to its obligations, as a public company listed on the Novo Mercado segment of the BM&FBOVESPA, and any and all material information will be disclosed in compliance with the applicable laws.

1Based on the total number of shares in each company, excluding treasury shares

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For more information, please contact our investor relations department:

Carlos Lazar - Director
Carolina Igi - Coordinator
Pedro Gomes - Coordinator

Phone: +55 (11) 3133-7309 / +55 (11) 3133-7314 / +55 (11) 3133-7311
Email: dri@kroton.com.br
www.kroton.com.br/ir


Contact IR

Phone: (55 11) 3133-7309
E-mail: dri@kroton.com.br