Apollo Group has sold Manders Portman Woodward (“MPW”) to Levine Leichtman Capital Partners Inc. ("Levine Leichtman") for £54.8m. MPW is one of the UK’s best known independent for-profit sixth form college groups with colleges in London, Birmingham and Cambridge. MPW offers full-time GCSE courses, A-level courses and intensive A-level and GSCE retake and revision courses.
Apollo acquired MPW’s parent company BPP Holdings in 2009 for £368m. Apollo expects to record a £15.6m gain during the fourth quarter from the sale. MPW contributed less than 1% of Apollo’s earnings last year.
MPW recorded operating profits of £3.93m (2010: £3.06m) in the twelve months ending August 2011 on revenues of £14.1m (2010: £12.6m). Operating margins hit 27.8% in 2011 up from 24.2% in the previous year.
The £54.8m purchase price represented 13.9x EBIT (earnings before interest and tax) in 2011 and 18.3x reported post-tax profits in 2011. MPW operates its college in London from interconnected period properties in South Kensington. It is not clear whether the purchase price includes these freehold properties which may be worth in the region of £12m.
An analysis of recent deals including an up to date exit valuation of MPW.
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