Major Blue Chip Training Provider Acquires Fern for £13.6 Million

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Carter and Carter (C & C, also known as “The Company”) Group Plc. has announced the acquisition of the Fern Group for a total of £13.6 million in a move that is expected to be profitable in the immediate future.

C & C are the major learning solution and outsourcing service support provider to major blue chip institutions, and the UK’s leading provider of government funded vocational learning with particular focus on automotive retail and manufacturing, food and drink processing, logistics, general manufacturing, engineering and sport. Their Directors have recently released an IFRS Transition Statement to set out the impact of the change to International Financial Reporting Standards. Whilst pleased with their company’s performance, they see the acquisition of Fern Group as a major step forward.

Fern Group and the Acquisition

The Fern Group is a key training provider for unemployed and disabled people under the Jobcentre Plus “New Deal” and similar programmes. These schemes aim to bring more people back into the workforce and thus lighten the budgetary burden of the welfare system regarding Incapacity Benefits whilst improving the lives and prospects of the individuals that it affects. This is a central theme in Government thinking at present, as can be seen by the recent release of the Department for Work and Pension’s (DWP’s) Green Paper on Welfare Reform.

Fern employs more than 300 staff and operates from sites throughout Britain. The Group focuses on basic skills training, along with programmes that offer associated support mechanisms to improve the employability of disadvantaged groups. The Group are also one of the principal providers of vocational qualifications for a number of major national employers, including companies such as Carillion and Compass, providing access to the construction, health and care sectors.

Cited as the reasons for the acquisition were that the move further strengthens C & C’s position as the leading vocational learning provider in the UK; that it will provide access to a key priority segment of the Government funded training and learning market, which sector the Directors” estimate is now approaching the £2 billion mark; the fact that it will create further opportunities for cross selling across the new expanded group; that it gives access to new occupational sectors of construction, health and care; and that this development is in line with C & C’s statement of intent to provide a range of vocational training products which together build a life-long learning model for people aged from 14 to 65.

C & C State their Case

The C & C Directors estimate that the Fern Group will generate an operating profit of £2.1 million in the year ending 31 May 2006. Commenting on the acquisition, the Chief Executive of C & C, Phillip Carter, said: “We are delighted to announce the acquisition of Fern and we look forward to working with Deborah [Deborah Fern, the vendor of Fern] and her experienced team.” Deborah Fern is expected to join C & C’s senior management team, providing continuity for the areas of the new group that Fern was and will be responsible for

Mr. Carter continued: “Fern is a provider of high quality training to unemployed and disabled communities and has recently received excellent inspection grades. Fern’s activities are at the heart of the Government’s strategy to place more people within suitable employment. In addition, we gain access to attractive new market sectors in health, care and construction. We believe the business has a strong strategic fit with our existing work based learning activities and will lead to significant shareholder value creation through further cross selling. The acquisition is in line with our strategy to further develop our life-long learning model.”

Jethro Marsh

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