Background

Water Babies Group Limited is the world’s largest baby and toddler swimming school, offering lessons to over 80,000 children annually across the UK, Ireland, Canada, the Netherlands, and the USA through a successful franchise network. Westerly Group and Elmsley Capital identified Water Babies as a key investment opportunity, seeking to capitalize on its international appeal and growth potential. To support their acquisition strategy, they engaged FRP to provide buy-side financial due diligence as well as valuation services to ensure a comprehensive understanding of the business’s financial health and prospects.

Action

FRP’s Financial Advisory team, led by Partner Justin Matthews, was appointed to deliver financial and tax due diligence services, carrying out a thorough review of Water Babies’ financial health and performance metrics. Tax specialists Lewis Dyson LLP completed tax due diligence whilst valuations expert and FRP Financial Advisory Partner, Jim Davies, provided additional support by undertaking a valuation of growth shares, ensuring a holistic assessment of the company’s financial standing.

Outcome

The team successfully completed the transaction with third-party leverage financing secured. This acquisition provides a platform for Water Babies to continue investment in its UK footprint and grow its market-leading swim education program at new locations throughout the US, creating new growth opportunities and enhancing the international brand.

FRP’s expertise in cross-border transactions was instrumental in navigating the complexities of the acquisition, providing strategic insights, deal considerations and facilitating negotiations that aligned with the needs of all stakeholders.

Ross Brendel, Westerly Group:

“FRP’s breadth of resources was indispensable during our investment process. In addition to facilitating an efficient FDD on a tight schedule, they helped us structure and navigate a cross-border acquisition with all the implications for our investors, the seller, and the management team. Their approach reflected positively on the go-forward leaders of the business.”

Brian Burke, Elmsley Capital:

“The whole team at FRP was a pleasure to work with, providing exceptional expertise and thorough analysis that gave us complete confidence in the transaction. We look forward to future engagements with them.”