Archer Capital-backed Aspire2 sees more acquisition opportunities after merger

Tuesday 3rd November 2015

Aspire2 Group, the newly formed training organisation backed by Australian private equity firm Archer Capital, sees more acquisition opportunities in an evolving labour market and as the government seeks to increase foreign student numbers.

The Auckland-based company has acquired private education businesses Cornerstone, Ntec, Queens Academic Group, Safety'n Action and Solomon Group to build the country's biggest provider of vocational courses to foreign students, with funding coming from Archer Capital and ASB Bank, Aspire2 said in a statement. The group currently has about 6,000 students, serves 7,000 clients through its Ministry of Social Development-funded youth services, and provides about 3,000 trainer days for business-to-business customers.

Chief executive Sussan Turner, a former MediaWorks boss, told BusinessDesk Aspire2 will look at expanding into new countries through its international division, made up of Ntec and Queens Academic Group, and will also investigate adding other private tertiary education groups that complement its existing businesses.

"The trade space is certainly an area where we've got some current capability with our welding school and dive etc. Those sectors might well be things in the future we say: 'if we were to build out in that space what would it look like?'" Turner said. "If you look at New Zealand's construction, whether it be what's happening in Christchurch or look at Auckland and what is coming down the line in terms of skilled workers, we see we've got to be ready to help provide some of those skills to industry in advance of there being need."

The merger comes as the tertiary sector gets ready for a potential shake-up, with the government today tasking the Productivity Commission to look at how new trends in technology, globalisation, population, tuition fees and demand for skills may drive changes in the industry's models.

Aspire2 will retain the founders of the acquired businesses for the company's advisory board and has hired former MediaWorks finance boss Peter Crossan as its chief financial officer.

Turner said Aspire2 will look at the skill-sets needed by countries where New Zealand is a leader and has an ongoing need, and ensuring the courses and training it offers are what employers want.

"We're not doing any of this in isolation," she said. "What we want to do is provide people with whatever they need - whether they're a client, whether they're a student - absolute success is them getting a job or getting a better job."

Aspire2 receives about 35 percent of its revenue from the Tertiary Education Commission and MSD, balancing revenue risk in the private sector.

"What you're wanting is to have as balanced a wheel as you can have so you can withstand any market changes," she said.

TEC figures show Cornerstone received $5.9 million in 2014, while Ntec's College of Future Learning received $1.6 million that year, Safety'n Action got $232,000, and Queens Academic Group $145,000.

BusinessDesk.co.nz

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