Private Equity Giants Circle UK Private Schools Group in 5 Billion Pound Deal

Major private equity firms are positioning themselves for a potential acquisition of one of Britain’s largest private school operators, as current owners prepare for a sale that could reach £5 billion in value. Swiss investment group Jacobs Holding has enlisted Goldman Sachs and Morgan Stanley to investigate strategic options, including a possible sale or stock market flotation of Cognita.

The education group, which manages 39 schools across the UK, has attracted interest from prominent private equity organisations including Permira, CVC and Blackstone. Cognita’s prestigious portfolio includes institutions that have educated notable alumni such as Lord Michael Heseltine, Eddie Izzard, and England rugby star Maro Itoje.

Despite Labour’s impending VAT implementation on private schools, Cognita remains confident about its financial outlook, citing its diverse geographical presence across 17 countries and an student body exceeding 95,000. The company’s international footprint includes the Stamford American School in Hong Kong, CHIREC International School in India, and New York’s York Prep School.

Industry analysts suggest Cognita currently generates earnings before interest, tax and other items surpassing £260 million, potentially commanding a valuation multiple of 18 to 20 times. The timing of this move aligns with rising valuations in the private and international school sector, as demonstrated by Nord Anglia Education’s recent $14.5 billion valuation following consortium investment.

While London Stock Exchange listing remains an option, market sources indicate a direct sale is more probable in the current investment climate. Cognita has emphasised its commitment to the UK market, with a spokesperson stating, “We are proud of our presence in the UK and remain committed to delivering high-quality education here. We have no plans to exit the country.”