Sovereign Capital seeks buyer for Outcomes First

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Private equity firm Sovereign Capital Partners has instructed Macquarie Group to sell its education and care business Outcomes First Group, sources close to the deal have revealed.

According to industry sources, the process is likely to begin early next year, with Macquarie expected to target infrastructure buyers for the business.

Sovereign is valuing the asset at around £300m or a multiple of almost 15 times its EBITDA, which is just above £20m, according to a source. Another source said the asset is expected to fetch a double-digit multiple, with EBITDA in the £20m-£25m range.

Outcomes First is a specialist provider of education and care services to children, young people and adults with autism, complex needs, learning disabilities and social, emotional and mental health needs.

It operates three service divisions: Options Autism and Learning Disabilities, Hillcrest Children’s Services and Sunflower Fostering.

Services operate across the south of England, West Midlands, North Wales and Yorkshire and Humberside delivering assistance to around 750 people.

A source said Antin Infrastructure Partners, which is seen as a natural buyer, is unlikely to purchase the company due to its children’s specialist education business Kisimul having one of its homes in Swinderby closed by Ofsted over safeguarding concerns.

The standards organisation closed the premises in Lincolnshire, in November and referred the matter to the police for investigation.

Earlier this week, the Financial Times reported that Sovereign had put foster care company Partnerships in Children’s Services up for sale for an asking price of £100m.