The Abarca Cidón family, the owners of HM HospitalsThey put their subsidized schools business up for sale. They have hired KPMG to lead the sale of the firm, Educare, for around 300 million euros, according to financial sources.
The The education sector has emerged as one of the few where the appetite for funds has not waned neither because of the rise in inflation, nor because of the rise in interest rates, nor because of the threat of recession. And the shareholders of the Educare subsidized school company are trying to take advantage of the opportunity to launch the sale of the company, which owns eight subsidized schools in Madrid.
The main shareholder of Educare is the Abarca Cidon family, founders of the HM hospital chain. They own 65% of the education business through their family office Alma mater. The remaining 35% belongs to the company Gestión de Centros Educativos (Gecesa), in the hands of Carlos Madruga Rael, president of Educare.
This society dates from the 70s, with the creation of the El Parque school. In the following years, he weaved a network throughout the Community of Madrid, with the Valdefuentes, Peñalar, Peñalvento, Torrevilano and Montesclaro centers. In 2015 Gecesa merged with Educare, the Abarca Cidón firm, to create the current company. In addition to the aforementioned schools, it has opened two more centers, Antamira and Antares.
In total, the company employs around a thousand workers and has 10,000 students. In the 2020 financial year, the company suffered for the months, from March to June, in which Covid-19 forced 100% online teaching. It registered a profit close to five million euros, 30% lower than the figures of the previous year. Revenues fell by 20%, to 30 million.
The company attributed this result to having stopped receiving income from the dining room or extracurricular activities. The return to face-to-face from the 2020/2021 academic year has allowed the company to return to the figures from before the pandemic. And it offers investors an ebitda of 17 million. Taking into account the valuations that the market manages for this type of asset, above 15 times, the first appraisals in the company rise to 300 million.
The company faces a debt, at the end of the 2020 financial year, for 72 million. They mostly correspond to a series of loans, some backed by real estate assets, with CaixaBank, Bankinter and Santander. The company closed that year with a box of 6.6 million.
The large venture capital funds have launched in recent years to take positions in this sector. One of the most successful cases has been that of providence, which acquired in 2017 the Nace schools from Magnum, the Ángel Corcóstegui fund, for 350 million. He integrated this company into a larger platform, which he called Globe Educate, with 31,000 students and 55 schools spread across France, Canada, Andorra, Malaysia, Portugal, Italy, India, the United Kingdom, Cyprus and Andorra.
In Spain, the presence of the European education giant Inspired Education also stands out, which has acquired King’s College or the San Patricio schools. It is owned by venture capital giants Warburg Pincus and TA Associates. Other funds have opted for higher education. CVC acquired the Alfonso X University Y Permira, the European University.
The Educare operation is a golden opportunity for a venture capital fund to position itself in this sector in Spain. And, through this company, I can create a platform with which to enter the game of consolidating private education in Spain, still very fragmented.