Wolseley Private Equity sells its investment
Sunday 8 September 2013
Wolseley Private Equity sells its investment in Guardian Early Learning Group to Navis Capital
Wolseley Private Equity has sold its investment in Guardian Early Learning Group, Australia’s leading fully integrated childcare service provider, to Navis Capital Partners, positioning the business for future growth.
Guardian’s management team will remain as significant shareholders.
The Guardian Early Learning Group has a portfolio of 69 centres, predominantly in Sydney, Melbourne and Brisbane, under three business units: Guardian Early Learning Centres, Guardian Childcare Management and Jigsaw Corporate Childcare. It provides care for more than 8,500 families with more than 5,700 licensed places.
Wolseley Private Equity initially invested in Guardian through its Fund II in January 2011. It believed the childcare and the early learning sector had strong growth prospects as it had become increasingly fragmented and was facing capital pressures.
Working with CEO and co-founder Tom Hardwick, Wolseley expanded Guardian’s senior management team and delivered a strategy of incremental organic growth and step growth through the acquisition of 21 centres, including 10 owned by Jigsaw Corporate Childcare, Australia’s leading provider of corporate early learning centres.
During Wolseley’s investment, employee numbers rose from 720 to 1700.
Richard Burrows, Guardian Chair and Wolseley Director, said: “When we invested in Guardian, our objective was to grow the business and build on the existing platform.
“Wolseley led the acquisition and transaction processes to substantially evolve Guardian into Australia’s leading independently-owned early education business, with a significant footprint in the corporate childcare space.
“We’ve created a fully-integrated business, unique in Australia that spans all aspects of childcare and early learning services. Together with management, we have driven compound annual revenue growth of 46 per cent, tripled group profit in two-and-a-half years and increased occupancy rates.
“We believe Guardian is now the stand out business in an attractive sector that has significant growth potential for the new owner. We wish the team continued success,” Mr Burrows said.
Mr Hardwick said: “The Wolseley team has provided great support to the business – not only through growth capital, but also through significant strategic guidance and institutional governance.
“Wolseley’s wealth of experience has assisted us in pursuing our business goals. The investment team has actively supported the business through each transformative step and I look forward to continuing Guardian’s journey and its growth in partnership with Navis Capital Partners.”
While the sale terms are confidential, Mr Burrows said: “Our investment alongside Tom and his management team has been very successful, delivering excellent returns to our investors.”
“The sale of Guardian Early Learning Group represents a strong result in the current market and a result consistent with Wolseley’s track record, providing a 2.3X return and IRR of more than 40 per cent,” Mr Burrows added.
Guardian Early Learning Group’s sale is the first exit from Wolseley’s Fund II and comes as the company embarks on capital-raising for Fund III.