Pitch Best Small Cap Deal 2020: NCOI – LOI

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Involved firms and advisors 

Involved firms and advisors buy side:
Allen & Overy (Tax Advisory and Legal Advisory Corporate M&A)

Involved firms and advisors sell side:
Houthoff (Legal Advisory Corporate M&A)

Pitch

Brief description deal / Deal outline
Netherlands-based private educational institution NCOI has acquired its closest Dutch concurrent LOI. With more than 12,000 enrolled students, 50 different higher professional education programs, various secondary vocational programs and a wide range of independent courses, the LOI has traditionally been one of the largest private educational institutions in the Netherlands. It has 370 employees.

The two brands will continue to exist side by side. Founded in 1923, the LOI has existed for much longer than NCOI, but is much smaller. The company claims to offer more than a thousand courses – from short-term courses to complete higher vocational education -. 

Founded in 1996, NCOI, which stands for Netherlands Commercial Training Institute, has grown in more than twenty years to become the largest private educational group in the Netherlands. NCOI Groep offers courses at all levels: masters, hbo, mbo and mhbo, and courses and training in all kinds of fields. The NCOI Training division claims to be the "largest trainer in the working Netherlands". 

LOI and NCOI expect to enhance each other by exchanging knowledge and experience in areas such as quality of education, approvals, IT and finance.

The NCOI Group employs 2,200 people. A large part of the teachers is not included. These are often freelancers. 

Deal rationale
This deal is a logical and smart step in the buy and built strategy of NCOI.
NCOI's growth is partly the result of a series of acquisitions. In 2015 it became the owner of Schoevers, known for its secretary training, and in 2014 of the Netherlands Language Institute. Vergouwen Overduin (in 2014), Boertien (2014) and Scheidegger (in 2010) are also among the companies that NCOI founder and foreman Robert van Zanten has incorporated since 2010. As a result of the economic crisis, many training institutions were in dire straits.

Van Zanten suspected that the market for training and courses would pick up again after the crisis. “It is difficult for companies not to invest in their employees for years. So there will be a catch-up effect ”, he told Het Financieele Dagblad in 2015. A notable takeover was that of Luzac, the chain of private schools that provides mavo, havo and vwo courses in relatively small classes, in 2016.

NCOI, the largest private training institute for people with a job, has grown strongly in recent years, mainly due to the acquisition of Luzac in 2016. Luzac offers secondary education at MAVO, HAVO and VWO levels from first year to final exam. NCOI bought Luzac from private equity firm Nordian Capital Partners.

At the end of 2018, the NCOI of entrepreneur Robert van Zanten also took a substantial minority interest (49%) in De Baak, a training ground for the Dutch management elite. And earlier this year, NCOI took over Hogeschool Tio, with offices in Amsterdam, Rotterdam, Eindhoven, Utrecht and Hengelo, among others.

NCOI and LOI offer training at recognized higher vocational and secondary vocational education levels, as well as professional courses. 

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