The directors of a leading UK-based online continuing professional development (CPD) provider have hired advisors to oversee a capital raise that could result in a majority or partial sale of the business, EducationInvestor Global can reveal.
This publication has learnt that the shareholders of National Education Group (NEG) have instructed corporate financiers from Grant Thornton to scope out potential investors, which could be offered a minority or controlling stake in the company, depending on the ultimate deal structure.
Grant Thornton is preparing NEG for market and is expected to kick off a formal process later in the summer, a source familiar with the plans told this publication.
NEG, which in 2018 took home EducationInvestor Global’s ‘market entrant’ award just 12 months after its incorporation, sells remote CPD courses to schools. According to the firm’s website, its offerings are used by more than 30,000 institutions worldwide.
Grant Thornton will calculate NEG’s enterprise value based on a run-rate earnings before interest, tax, depreciation and amortisation (EBITDA) figure “north of” £4 million, said a well-placed source, adding that the firm is showcasing “strong” annual growth domestically and overseas. Run-rated financials factor in assumptions and projections predicated on recent trading volumes.
Another insider put NEG’s year-on-year growth “in the region of 20%”.
According to filings with Companies House, NEG has three shareholders – Neil Gamewell (co-founder and chief executive), James Southworth (co-founder) and Joseph Stoney (commercial director).
Any capital raised later this year will be used to fund expansions in the UK and internationally, a source familiar with NEG’s strategy said.
NEG’s offering at present encompasses three programmes – Essential CPD, The National College and National Online Safety.
Essential CPD provides video-based CPD courses delivered by industry experts that help schools meet their statutory training requirements.
The National College monitors policy, practice and research developments and condenses them into concise video-based CPD products designed to save school leaders “time and money”.
National Online Safety, meanwhile, sells accredited courses and resources that educate school communities on online safety.
Grant Thornton is also advising school software group Orovia on its upcoming auction, as revealed by this publication, and last year led the sale of school management information system provider iSAMS. In the past 12 months, Grant Thornton has facilitated the sales of PDT Global to Learning Technologies Group; Cirrus to Accenture; Strictly Education to Supporting Education Group; and London Preschool Group to Three Little Birds.
Grant Thornton declined to comment on its role in relation to NEG when contacted by EducationInvestor Global.
Date published: 10 June 2021