Connect Education & Care, the Trowbridge-based firm formerly known as The Consortium, is to be sold for £56.5m – some £18.5m more than its current owners bought it for less than five years ago.
Following a staff and management buyout in 1995 it grew into a national business providing a large range of products spanning education, fire and rescue and care homes.
It was acquired by Swindon-based Connect Group – formerly Smiths News – in 2012 for £38m as part of the newspaper distributor’s strategy of diversifying into specialist distribution markets and now has more than 30,000 customers with an extensive range of 40,000-plus products including stationery, arts and craft and cleaning.
Connect Group is now selling the business to Abingdon-based RM, which supplies software and IT services to the UK and international education market.
RM said Connect Education & Care would be combined with TTS, its existing and well-established education supplies business. It said the acquisition would provide a number of “operational and financial benefits” including savings of around £2m a year.
Connect Group said proceeds from the disposal would reduce its borrowings, giving it more flexibility to pursue growth in specialist distribution.
It bought Sheffield-based The Big Green Parcel Machine Holding Company, whose principal subsidiary trades as Tuffnells Parcels Express, in 2014 for £113m. The newly-formed parcels division has since performed strongly, offsetting a decline for its core newspaper and magazine distribution business.
Connect Group also owns book wholesaler Bertrams, online retailer Wordery and academic library supplier Dawson Books.
In the year to August 31, Connect Education & Care had pre-tax earnings of £7.8m on revenues of £64.8m. The sale is expected to be completed in the next few months.