Spike in M&A activity in the education sector

Wed, 22 May 2019 | BUSINESS SALE



In recent months, the education sector in the UK has witnessed a spike in merger and acquisition activity – a result of a number of private equity firms eager to buy into this particularly lucrative market and capitalise on its data and revenue streams.

Most recently, French investor Ardian has purchased a majority stake in Study Group, a provider of international education in the UK, Europe, Australia, New Zealand and North America, from asset manager Providence Equity Partners. In a similar fashion, Times Higher Education (THE) was taken over by mid-market private equity firm Inflexion from TPG Capital.

In both instances, the acquisitions were strategic moves to increase presence in new locations across the world and previously-untapped markets.

The merger and acquisition team at OC&C Consultants advised on both deals, providing buy-side advice on the Ardian and Study Group case by assessing market position and growth potentials, and sell-side advisory on the Inflexion and THE deal by supporting vendor due diligence.

As a result of the acquisition, the THE management team will operate alongside Inflexion to tackle booming demand from universities across the globe for data and branding products with the end goal of boosting academic performance, as well as attract new students, academics and investment.

Managing partner at Inflexion, Simon Turner, said: “Times Higher Education has an excellent brand and an exceptionally driven management team. By carving the business out, we can firmly focus on building its core strengths, namely through enhancing its digital presence and continuing its global expansion, particularly in the US and Asia. We look forward to working with management to build upon the strong foundations they’ve created.”

The acquisition will also allow Inflexion to create and launch a series of add-on products, primarily through expanding its digital services in new international arenas.

Similarly, Ardian’s takeover of Study Group, now valued at roughly £500 million including debt as a result of the acquisition, will ensure strong growth and stronger partnerships between students and some of the leading universities across the world.

One of Ardian’s managing directors, Olivier Personnaz, commented on the acquisition, saying: “We are proud to invest in Study Group for the next phase of its development. The ambition of the management team, the quality of their long-term university partner relationships and the strength of its growth serve as proof of Study Group’s excellence.”

Such pursuits in the M&A market is indicative of an incline; these two deals build on the acquisition of TES Global by Providence at the end of 2018 for an undisclosed sum. Therefore, it appears without a doubt that interest and activity is strife in the education sector, leaving much to be looked forward to in the future.

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