Relevant Document:
BPP Topco Accounts 2022
TDR Capital has mandated Morgan Stanley and Houlihan Lokey to sell its U.K.-based education business BPP Education, sources told Reorg.
Vendor due diligence of the business, which is expected to be marketed off EBITDA of about £130 million, is underway, the sources said.
H&F, KKR and TA Associates have expressed early interest in bidding for the business, sources added.
Leveraged buyouts of European education services companies have an average multiple of 13.1x, according to
Fundamentals by Reorg. Private equity firms including CVC, Montagu, NPM Capital, Antin, TA Associates and FTV Capital have recently made investments in the sector, according to Fundamentals.
BPP is a U.K.-based provider in the professional and vocational higher education market, providing training and qualifications in a diverse range of professional verticals including law, accountancy and tax, business and finance, digital and data analytics, actuarial and nursing both to corporates and directly to consumers.
TDR Capital acquired the business in July 2021 via TDR Capital IV, according to its
website.
BPP generated turnover of £247.6 million and made a loss before tax of £91.3 million in the 18-month period ended Aug. 31, 2022, according to its most recently available public accounts. It said the operating loss was driven by amortization of intangibles of £89 million and excluding amortization there was an operating profit of £44.9 million.
The company took out a £20 million accordion senior facility in October 2021 and extended this with a further £24 million in June 2022, according to the accounts. These facilities had an all-in cost of SONIA+6.25% and were added to the senior term facilities agreement of £255 million, which charged interest at an all-in cost of SONIA+6.75%, according to the accounts.
Houlihan Lokey, KKR, Morgan Stanley and TDR declined to comment. H&F and TA Associates did not return requests for comment.