Swindon-based newspaper distributor and parcel delivery group Connect is to sell its education and care division for £56.5m – some £18.5m more than it bought it for less than five years ago.
Originally called The Consortium, the Trowbridge-based business has supplied 
books and stationary to generations of schoolchildren across the South West since it was launched in 1971 as a local authority supplies organisation.
Following a staff and management buyout in 1995 it grew into a national business providing a large range of products spanning education, fire and rescue and care homes.
It was acquired by Connect Group – formerly Smiths News – in 2012 for £38m as part of the newspaper distributor’s strategy of diversifying into specialist distribution markets and now has more than 30,000 customers with an extensive range of 40,000-plus products including stationery, arts and craft and cleaning.
Connect Group said proceeds from the sale to Abingdon-based RM, which supplies software and IT services to the UK and international education market, would reduce its borrowings, giving it more flexibility to pursue growth in specialist distribution.
It bought Sheffield-based The Big Green Parcel Machine Holding Company, whose principal subsidiary trades as Tuffnells Parcels Express, in 2014 for £113m. The newly-formed parcels division has since performed strongly, offsetting a decline for its core newspaper and magazine distribution business.
Connect Group also owns book wholesaler Bertrams, online retailer Wordery and academic library supplier Dawson Books.
Group CEO Mark Cashmore, pictured, said: “The disposal will provide the group with greater financial flexibility as we continue to drive our operational priorities and growth strategy.
“Looking ahead, the group remains focused on delivering long-term value for shareholders, deploying our capital to deliver a balance of strong dividend, deleverage and re-investment for further growth.”
Last month Connect Books revealed a strong Christmas trading period, with like-for-like sales up 15.1% across its wholesale business and online platform Wordery.
In the year to August 31, Connect Education & Care had pre-tax earnings of £7.8m on revenues of £64.8m. The sale is expected to be completed in the next few months.
