Advanced Childcare sold for £28m

A NORTH West firm which manages children’s homes for local authorities has changed hands in a £28m deal.

Stockport-based Advanced Childcare was put up for sale by London-based Bowmark Capital last autumn and after a process  led by KPMG Corporate Finance in Manchester the business has been sold to GI Partners.

Advanced Childcare, which was founded in 1996 by former social wiorker Riz Khan, is based in Bredbury. As well as providing care and education to young people with behavioural, emotional and social difficulties the company operates two fostering agencies.

The sale has generated a return of more than four times Bowmark’s original investment. Since it acquired the business in late 2004, Advanced Childcare has expanded across the north of England and the Midlands, growing from a base of seven care homes with 40 residential beds to its current estate of 30 care homes with 123 residential beds and two fostering agencies.

Advanced Childcare now has more than 60 local authority clients across England and has an reputation for high quality care with excellent ratings from Ofsted.

Ron Pearson, a partner of Bowmark, commented:  “Advanced Childcare has capitalised on the increasing demand from local authorities for high quality, fair value care provision, by combining the highest standards of care with a broad range of services to meet the diverse needs of individual clients.
  
“It has an excellent record of achieving positive outcomes for young people, and the success of the company under our ownership is a testament to the quality of the management team.”

Riz Khan, chief executive,  added: “Our partnership with Bowmark has been very successful.  We now look forward to our next phase of development, with our new capital partners, GI Partners, when we will aim to capitalise on the significant growth opportunities in our market.”

Jonathan Boyers said: “We are delighted to secure the secondary buyout which will provide a sound footing for the business. This deal is also a demonstration that the UK private equity market is still very active.”

In addition to Jonathan Boyers at KPMG, Bowmark’s advisory team comprised: SJ Berwin on the legal side; PWC commercial due diligence; BDO did financial due diligence, while KPMG also adnised on tax matters.

GI Partners’ advisory team included: BDO, PWC, Trowers Hamlin (legal) and Colliers International (property).

Advanced Childcare’s management was advised by Andy Parker at PWC, and James Kerrigan at DLA Piper in Manchester.

The Manchester office of Yorkshire Bank Corporate and Structured Finance, led by Roddy Kilpatrick, provided debt for the deal.