Nursery sell-offs spark concern
Tuesday, January 15, 2008
The Pre-School Learning Alliance has raised concerns about the sustainability of the nursery sector after it emerged that Kids Unlimited is likely to become the third major provider to be put up for sale in recent months.
It is understood that Kids Unlimited's private equity owner, Isis Equity Partners, has called in auditors Deloitte to consider the future of the firm, with one option being a sale for about £40m to 50m. The company had no comment to make.
Steve Alexander, chief executive of the Pre-school Learning Alliance, said: "This is a concern in terms of diversity and choice for parents if there are fewer providers. It's also a concern for the state of the sector financially if more providers are being sold."
Last summer, Leapfrog was acquired by Busy Bees, which in December 2006 was itself bought by Australian childcare firm ABC Learning Centres.
Alexander estimates that the £31.2m that ABC paid for the 88-strong Leapfrog chain, "was about half its value, and shows how depressed the market is." He added: "Of the 20 largest providers, 18 made a loss last year."
