Shaw & Co has advised on another deal in the education/recruitment sectors...
Now Education, one of the UK’s leading suppliers of staff for primary, secondary and SEND schools across England and Wales, has announced a management buyout led by its co-founder and Managing Director, Alex Westworth.
The deal, which has been supported with institutional investment of £14m from Prefequity LLP, values the business at £28m.
Founded in 2010, Now Education supplies around 1,600 supply staff to more than 800 schools per week across England and Wales. It recruits in more than 20 regions and has permanent offices in Birmingham, Cardiff, Leeds, Lincoln, Liverpool, London and Nottingham. Comprising a team of nearly 40 consultants and ten back-office support staff, 95% of its business is from contract revenue with more than 75% of placements six weeks in length or longer.
Shaw & Co provided corporate finance advice on the deal which will see Gary Redman (previous majority shareholder and CEO) move to the role of Chair, and Johnny Carew Pole, Partner at Prefequity LLP, join the company’s board of directors.
Now Education has grown consistently since its inception with forecasted gross profit of £7.9m and £3.9m adjusted EBITDA for FY23 - figures that are predicted to double by FY27. The management buyout will provide a platform from which to continue the company’s impressive growth, made possible by its innovative shared equity model that sees proven and successful consultants fully supported in launching their own Now Education offices in new regions across the UK.
Freeths provided legal advice to the management team on the deal while Wilkes and Ward Hadaway provided legal advice to Gary Redman and Prefequity LLP respectively. Additional support for working capital was provided by Lloyds Bank via its invoice discounting facility.
Alex Westworth, CEO, Now Education, said: “This strategic MBO has empowered me and the rest of our shareholders to shape and drive the future growth of Now Education. This milestone marks the latest chapter in our growth story and Gary Redman will be there as Chair to support us with his wealth of experience in the recruitment sector.”
Gary Redman, Vendor and new Chair, Now Education, said: “I am delighted that we have completed the MBO, working with a group of advisers and investors to achieve what is a highly successful outcome for all parties.
“I am also pleased that I will still have a part to play in shaping the future of Now Education. Alex Westworth is an extraordinary and capable leader who will take the business to the next stage of its journey. We have built a company with a unique structure and shareholding offering and we have some incredible people at all levels. I look forward to helping the business grow even further.”
Johnny Carew Pole, Partner, Prefequity LLP, said: “We are delighted that Prefequity’s flexible capital will support Alex and team in their management buyout and also fuel Now Education’s continued growth. Now’s business model allows it to attract and retain exceptional talent, enabling it to deliver excellent value and service for schools, As a result, Now is well-positioned to cement its place as a leading player in the market.”
Rob Starr, Partner - M&A, Shaw & Co, said: “This deal has provided the ideal outcome for all stakeholders. With Alex at the helm and significant backing from Prefequity, the company has the strongest of foundations for its next stage of growth. Gary, meanwhile, will be able to enjoy the rewards of his many years of hard work while also playing an important role in taking the business forward.”
Gareth O`Hara, Senior Partner, Wilkes: “We're pleased to have guided Gary through this pivotal deal which marks another milestone in our long standing partnership that has been in place since Now Education’s inception. We remain committed to reinforcing our values of collaborating for success.”
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