HOW WE WORK
We ask every buyer for ‘ BUYER’S AGREEMENT' form.
This is an STC document which acts as a confidentiality agreement and a brief on area, type and budget. We do not ask for a lengthy NDA (Non-Disclosure Agreement). We judge people principally by how they act – not what they sign.
We also require every buyer to provide detailed information about themselves and their background. This information will be shown to the seller of each business in which they may be interested.
SELLERS
Sellers sign a ‘ TRANSFER AGREEMENT’.
This acts as an agreement on our terms of business and also an undertaking to keep details of potential buyers strictly confidential at all times. This is important because most buyers are involved in other activities and do not want their interest in acquiring their own educational businesses to be known. If you are thinking of selling through us, please click here to go to the ‘SELLER’S INITIAL ENQUIRY FORM’.
This sector is particularly sensitive to rumour and speculation so it matters very much that all negotiations are strictly confidential.
No news of a sale must leak out until exchange or completion have been confirmed.
At that point, the buyer can be introduced to the staff and parents in a positive way.
STC ’s confidential, friendly service exists to protect not only our sellers but also our buyers – because it protects the business they are buying.
All we ask of our buyers is that they sign a simple, straightforward agreement committing them
1. To treat all information as strictly confidential
2. To negotiate through STC
3. Not to talk to local banks or planners
and if they don’t stick to their promises, we stop dealing with them.
Top
BUYERS
IS INDEPENDENT EDUCATION A WORTHWHILE SECTOR FOR INVESTMENT?
Yes, for a variety of solid reasons:
1. Life is short. Education matters. It is a worthwhile way to spend your energy.
2. It is an excellent long-term investment – because its ‘customers’ are committed for the long term. Parents who have chosen to invest in education for their children do so out of care and passionate aspirations for their heirs. They will generally remain loyal customers for between 5 and 15 years. They pay in advance; plus a deposit. They give at least a term’s notice. They are prepared to make all sorts of personal sacrifices in order to keep their children at schools where they are performing and happy. That describes nearly all independent schools these days.
WHO ARE THE BEST BUYERS?
To ensure that school transfers remain confidential, it is important that offers are made and completed quickly.
Therefore, preferred buyers are:
- Those who have their funding in place, their lawyers ready and an early completion date in mind.
- Those who play by the rules and do not attempt to negotiate direct.
- Those who can demonstrate their capability and are realistic about their parameters.
- Those who stick to the offers they make.
We can give you a rough idea of what is available in the market but we cannot give precise locations or facts such as pupil numbers.
That is because such information could give away the identities of the businesses we are selling (or lead to completely false rumours).
For that reason, those schools and nurseries we do mention on this site are deliberately described in the vaguest terms.
We have divided the UK into three parts – North, Middle and South – to give you a rough idea of where the businesses are.
HOW TO FIND OUT A LOT MORE
To give you precise details of any business we shall need a ‘ BUYER’S AGREEMENT ’. This acts as an undertaking on Confidentiality and also as your Brief to us. We shall also need full details of you or your company. It is on the basis of that information that our vendors will decide whether or not they wish us to release further details. It is their decision, not ours.
To download these forms click here.
These forms have to be signed by everyone who may see the highly sensitive business information. It could be that one of them has a connection with a school/nursery we are selling. It is essential that they do not tell anyone that it is for sale, even their best friend.
Our service is confidential to protect the interest of the seller
- The business details are deliberately described so as to avoid giving precise information on pupil numbers, location and other factors which may disclose its identity. For example, pupil numbers may be given to the nearest 50.
- We have other major businesses available which do not appear in these lists. Buyers with larger budgets are invited to discuss their plans with us in confidence.
- If you wish to know more about an educational business, please quote the reference number to us. Full information may be sent upon request only once a proprietor has given approval and seen a buyer’s curriculum vitae and business details. We cannot give hints on location or numbers.
- All figures quoted are approximate to maintain confidentiality.
- Please Note: Full details of any establishment will be sent out only to buyers who have completed and returned originals of our confidentiality agreements and provided CVs.
Top
Most Frequently Asked Questions
How do you value schools and nurseries?
Nurseries and schools are highly individual businesses. No two are remotely the same: each one reflects the personality of its owner. This is one reason why it is not possible to apply any kind of a ‘standard’ multiple of earnings as a price guide - although buyers and their accountants may be keen to convince you otherwise.
It is how the profits are produced that counts. A business with high profits but low staff pay, poor maintenance and outdated facilities may be worth very little. A business that has invested heavily for the future over a couple of years and has low profits may be worth a great deal.
Some checkpoints to consider:
1. If the business makes attractive profits, is this purely because its performance and reputation are excellent?
2. Are the staff properly rewarded?
3. Are the facilities up to date?
4. Are the fees too high – and are parents beginning to defect?
5. Are the fees low – is there opportunity for growth?
6. What competition is there in the area? Has anyone new come on to the scene?
7. Has the business shown a consistent record of gently rising profit? Or have profits shot up just in time for a sale?
8. If the premises are freehold, what is their value and how well-maintained are they?
9. If the premises are leasehold, how long is the lease and what term remains? How well maintained are they – and who is responsible for maintenance?
10. How much money would you want to spend once you had taken over the business, on what and why?
Now you can see that the questions are endless – and why no simple multiples can be applied.
The best formula to apply is commonsense. For instance, a small school in the middle of nowhere is clearly going to achieve a very small multiple of profits but a small school in Central London will achieve an excellent result. As a general rule, the smaller the business, the harder it is to find a buyer.
The bigger the business, the tougher the negotiation. It is vital to find a buyer who will keep to the timetable and stick to their offer.
How long do schools and nurseries take to sell?
Usually between 3 months and 2 years. This depends on many factors including demand, price and location.
The fact that a business has been on the market for a while does NOT mean that the price can be beaten down. It is more likely that we are sticking out for the right price until we get it.
Where does STC sell educational businesses?
Mostly in the UK but also in Europe and worldwide.
Click here to view ‘ BUYER’S AGREEMENT’ information and agreement form
Click here to view SELLER’S INITIAL ENQUIRY FORM
Top
|
