The UK market is highly fragmented with more than 20,000 operators1, many of which are single site nursery care providers, and no individual group has a market share above 5%2. As a result, the structure of the current market provides significant opportunities for investors looking to consolidate. UK nursery groups represent excellent buy and build platforms for further acquisitions.
Whilst the market is characterised by small nursery care providers, the value and size of the sector has continued to grow, fuelled by the expansion of the two pre-eminent groups in the market - Busy Bees and Bright Horizons. The overall sector is worth nearly £5.3bn and has been growing more than 5% a year since 20083.
A recent deal saw nursery group Noah’s Ark acquired by Hadland Care Group, which operates Tops Day Nurseries. The group currently has 27 sites in the UK and is looking to expand via acquisitions to a 40-strong operation by 2021, showing the appetite for buy and build in the market.