Cambridge Education Group sold for almost £200 million

Bridgepoint has bought the pathway course provider from another private equity firm, Palamon Capital Partners.

The deal will “generate a return on investment for Palamon of 14.6 times, with a capital gain of £141 million”, Palamon said in a statement today.

CEG provides pre-university education to more than 4,000 students recruited from over 95 countries. It has four divisions in three countries: CATS, a sixth-form college network with campuses in Cambridge, Canterbury, London, and Boston in the US; “foundation campus” programmes operated through partnerships with 20 universities in the UK, US and Netherlands; the College of Visual and Performing Arts in Cambridge; and English as a Foreign Language schools, operating under the Stafford House brand.

CEG runs foundation campuses for Coventry University, Sunderland University, the University of Central Lancashire and London South Bank University.

In addition, its London Foundation Campus, based at Birkbeck, University of London, “works with a number of the leading University of London colleges, including Queen Mary, Royal Holloway and the Royal Veterinary College”, according to the CEG website.

Bridgepoint said in a statement: “The international student market offers long-term sustainable growth. It benefits from the emerging middle classes in high-growth economies able to fund a Western education and increasing demand for degrees from UK and US universities in emerging international labour markets where the reputation of Western academic institutions remains high.”

Palamon said that under its ownership, which began in 2007, the company has grown revenues five-fold to an estimated £90 million for the academic year 2013-14.

Chris Busby, the partner responsible for Bridgepoint’s investment activity in the UK, said: “Cambridge Education Group has grown substantially, extended its teaching, targeted new markets and importantly, delivered strong academic results. Our investment will provide the team with additional financial capacity and reach to accelerate its push further into international markets and realise its ambitions in a growing market.”

john.morgan@tsleducation.com