FSG, is a specialist independent fostering company providing more than 100 Local Authority foster care placements across Kent and South London.
The acquisition is in line with Care UK's strategy of investing in the children's care market, building on the Company's existing presence in the residential care sector. FSG is a highly regarded fostering provider and the opportunity exists both to extend its current scale within London and the South East and to replicate its services in other regional locations as part of the overall development of children's services within Care UK.
Care UK is acquiring FSG from a number of private vendors, for a maximum of £3.6 million of which £3.0 million was paid on completion with £0.6 million being contingent on the results for the first six month period following completion. The acquisition will be financed from Care UK's existing borrowing facilities.
FSG's turnover for the year ended 31 March 2004 was £3.8 million, with profit before tax of £123,000. After the elimination of non-recurring costs associated with the exiting vendors, FSG would be expected to deliver an initial annual operating profit of around £400,000. Jonathan Toomey, currently Operations Director of FSG, will continue to run the business on a day-to-day basis and will take responsibility for developing the longer term potential for the business within Care UK.
Mike Parish, Chief Executive of Care UK commented:
"I am delighted that we have agreed the acquisition of FSG. It is a good quality business providing excellent services in the foster care market. FSG strengthens our presence in the children's care market as part of our strategy of providing specialist services to the public sector across the care continuum."