Sovereign Capital acquires UK schools group DLD in a £25 million institutional purchase

Sovereign Capital Limited ("Sovereign Capital") announces that it has led the £25 million institutional purchase of one of the UK's leading private education businesses Davies Laing & Dick Limited ("DLD"). This is the second deal from Sovereign's new fund, which closed in April 2002.

Headquartered in London, DLD operates 11 schools and colleges across the UK. These include several prestigious schools: Wetherby, Pembridge Hall and Portland Place, the Falcon Schools, Abbey Colleges and Davies Laing & Dick College.

The education sector is large and fragmented. The supply for quality independent schools is a growing market, particularly in the Central London area. This is primarily due to the increase in first time fee payers generally dissatisfied with the state provision, (a position amplified in London) and the competition for places in leading schools.

Paul Brett, Strategic Director of Serco plc's educational business will become the new Chief Executive Officer of DLD. While at Serco, Paul built a £50 million business providing educational services across the UK. Brett is joined by Finance Director James Macnamara, previously FD of the highly successful MBO, Pall Mall Holdings, where he worked with Ryan Robson who led the Sovereign deal team. The new members of the management team are working with Angus Fraser the current Chairman and Nigel Pinn, Operations Director to implement a buy and build strategy for the group.

Andrew Hayden, Director, Sovereign Capital worked closely with Robert Hay of Bank of Scotland's Property Finance Division to structure an innovative funding package which recognised the fixed asset backing of the group and the strength of its cash flow. Both Andrew Hayden and Ryan Robson join the board.

Angus Fraser, Group Chairman, DLD, commented:

"This marks an exciting new phase in the development of DLD and brings tremendous potential for the growth and development of our schools. Sovereign's approach has been excellent and we are confident that the business and its values will be safe in their hands."

Paul Brett said:

"I am delighted to be joining the management team.  The schools have excellent teachers and a reputation for producing strong academic results.  DLD is a quality business in a growth sector and Sovereign's financial firepower and commitment will enable us to put into action the buy and build strategy for the group."