Morgan Stanley Exits Learning Care

Morgan Stanley Global Private Equity has completed the sale of its majority interest in Learning Care Group (US) to American Securities. Learning Care Group is the second-largest provider of early childhood care and education services in the US.

“We are pleased with the outcome of this investment, which was the result of partnering Morgan Stanley Global Private Equity’s operating-focused investment strategy with world-class executives to build a leading provider of early childhood education,” said Jim Howland, Managing Director and Operating Partner of Morgan Stanley Global Private Equity.

Learning Care Group provides early education and child care services to children ages 6 weeks to 12 years.  The company operates more than 900 schools (corporate and franchised) across 36 states, the District of Columbia and internationally, and has a system-wide capacity to serve more than 100,000 children.  Learning Care Group operates under five brands: La Petite Academy, Childtime, Tutor Time, The Children’s Courtyard, and Montessori Unlimited. The company is headquartered near Detroit in Novi, MI (www.learningcaregroup.com).

“Learning Care is a great fit for our strategy of investing in market-leading companies,” said Kevin Penn, Managing Director at American Securities.  “We believe that Learning Care Group’s industry leadership, combined with its exceptional management team, positions the company for strong growth.”

American Securities invests in businesses with $500 million to $2 billion of revenues. Investments are undertaken with conservative financial structures that typically include only equity and senior debt. The firm aims to invest $150 million to $500 million of equity capital in each portfolio company. Sectors of interest include industrial manufacturing, specialty chemicals, aerospace and defense, energy, business services, healthcare, media, restaurants, and consumer products. The firm has more than $10 billion of capital under management and is currently investing from its sixth fund. American Securities has offices in New York and Shanghai (www.american-securities.com).

“Morgan Stanley Global Private Equity has been a highly valued partner during the past six years as we expanded our proprietary early childhood education programs and further sharpened our focus on providing outstanding customer service to the families in our care,” said Barbara Beck, Chief Executive Officer, Learning Care Group.

Morgan Stanley Global Private Equity, part of Morgan Stanley Investment Management, makes private equity and equity-related investments of $75 million to $150 million in companies with enterprise values of $100 million to $1 billion. To date, Morgan Stanley Global Private Equity and its affiliated funds have invested over $6 billion of equity across a variety of industries. The firm is based in New York (www.morganstanley.com/privateequity).

BofA Merrill Lynch and BMO Capital Markets acted as financial advisors to Learning Care Group.

© 2014 PEPD • Private Equity’s Leading News Magazine • 5-6-14