Big nursery chains set their sights on growth

In the past six months, The Co-operative Childcare has increased its number of places by 50 per cent, kidsunlimited has opened a further four settings and nursery group Treetops has secured an £8m loan to fund a further 19 nurseries.

At the beginning of May, The Co-operative Childcare acquired the Petit Enfant chain of four settings in Oxfordshire.

This followed its takeover of the Places for Children and Banana Moon nurseries in March, bringing the total number of nurseries in the group to 44, plus two after-school clubs.

The group, which ranked at number 13 in Nursery World's Nursery Chains league table last October when it was offering 2,044 places, now offers more than 3,000.

Also this month, nursery group kidsunlimited opened its 61st setting in Sale, Cheshire. It followed the opening of a 73-place nursery in Wokingham in March and a setting based in Maidstone in January. Prior to that was the opening of a nursery in Reigate last October.

Treetops, which operates 31 settings, has been through refinancing and reorganisation to secure a new loan with Barclays for £8m to expand the business to 50 settings within the next three years. The company's group finance director, Clare Wilson, said they planned to expand through acquisition and organic growth, by buying a mixture of stand-alone and groups of nurseries.

All three providers have ambitious plans for growth. The Co-operative Childcare has also indicated it has plans to expand the group to 50 nurseries. While kidsunlimited, which now has 61 settings offering 5,590 places, says it will continue along the expansion trail.

Kidsunlimited told Nursery World that five more nurseries are likely to open during the company's new financial year, which started on 1 May. Building work is underway on three of the projects. A new 71-place nursery will open in Richmond-on-Thames in September and in the same month an 80-place, new-build setting is due to open in Fleet, Hampshire. Another 65-place, purpose-built setting is planned to open in Surrey in January next year.

The company also revealed it has identified 150 locations in the south-east of England as possible locations for future settings.

ourteney Donaldson, director of childcare and education, for Christie + Co, a specialist property agent, which worked with Barclays on the refinancing and reorganisation of Treetops, said that overall the childcare sector 'is doing very well' and that increased demand for acquisitions now outweighs supply.

She went on to say that banks are becoming more supportive in lending providers money, but she warned that there is a mixed picture across the country, with nurseries in some areas struggling and others doing very well.

According to Ms Donaldson, many nurseries and other early years settings are being put up for auction.

While some of the large groups have been very active in acquiring and buying new settings, Ms Donaldson said that they only make up a small proportion of the total number of nurseries across the country.

'The chains would love to be in a dominant position, but I don't think they will take command of the sector,' she said. 'There are still lots of successful independent nurseries and it is easier for groups to buy a chain of nurseries rather than individual ones.'

She added, 'The Co-operative Childcare has been very aggressive and made some interesting acquisitions, while the opening of kidsunlimited's nursery in Sale, Cheshire was a good move as it is the only purpose-built setting in the area and there is a lot of demand.

'It has been a very busy start to the year and conditions are unlikely to change over the next five years, as there will always be owners that put their nurseries up for sale because they want to retire or spend more time with their families.'