Bertram eyes up further acquisitions

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The Bertram Nursery Group has 20m to spend on a further wave of acquisitions after it bought nine nurseries owned by the Manchester-based Holyrood Nursery Group last week.

Bertram's chief executive Graeme Scott told Nursery World that he thought the Scotland-based chain, which now has 27 nurseries providing 1,700 childcare places, would grow to 40 'in a matter of months' and could have a portfolio of 60 or 70 facilities within two years.

'We are basically on the acquisition trail and have a £20m cash facility to do this. There is no reason to stop acquiring if you are able to manage the whole thing,' he said, confirming that up to 12 more acquisitions were immediately in the pipeline.

He said that last year the company rejected between 12 and 15 potential acquisitions - 'so we don't go in for them just for the sake of it. It all depends on what comes along and whether it's of the right quality,' he added.

Mr Scott suggested that the process of sale and acquisition of companies had been given added impetus in the run-up to the April changes to capital gains tax (CGT). Firms were being sold so their owners could benefit from CGT taper relief which was removed, pushing CGT up to 18 per cent from 10 per cent.

Buying the Holyrood nurseries in Greater Manchester, which includes one leasehold facility in Salford, represents Bertram's first foray into the childcare market south of the border. Mr Scott said that managing nurseries that far south of Edinburgh was 'easily manageable' and that the company would be interested in further acquisitions anywhere north of Manchester.

The Bertram Group had just three nurseries in Scotland until it bought the 12-strong Happitots chain - Scotland's largest independent group - in April last year. Happitots' founder Heather Gilchrist is now chairman of the Bertram Group and visited the Holyrood sites before they were taken over.

Mr Scott said his group's nurseries were enjoying occupancy of around 'the high 70s' while the Holyrood sites were also 'close to 80 per cent', and he does not believe that will be dented by the current credit squeeze. He said good occupancy levels were down to a nursery's location and the quality of staff.

'All the managers and staff at the Holyrood nurseries are very good and that makes life easier to manage post-acquisition,' he added, pointing out that key senior management figures from the Manchester chain would remain in post.

Christie and Co brokered the deal between the two nursery groups and Rosie Everett, from the company's Manchester office, said, 'The deal price achieved was well in excess of the vendor's expectations on price.' But she added that 'Bertram were delighted with the price they paid for the Holyrood Group'.

In the summer 2007 issue of Nursery Chains, Bertram Nursery Group were already 18th in the league table of the UK and Ireland's largest nursery chains.

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