Firm Grows With Acquisition

March 24, 2008
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GRAND RAPIDS — American Education Group, a private-equity-backed network of private schools, has acquired a seven-site chain in the Boston area, giving the company’s schools a reach from preschool through 12th grade.

Little Sprouts Inc. became AEG’s third acquisition earlier this month, joining Tampa Day School, a kindergarten through eighth grade school in Tampa, Fla., and Barnstable Academy, which serves middle and high school students in New Jersey.

AEG President Peter Ruppert said he believes the movement toward academically oriented preschools such as Little Sprouts will accelerate. “Parents are going to realize that for a little bit more money, they can have their children taught in environments so that when the kids get to kindergarten or first grades, they are more prepared,” Ruppert said.

He said he expects to expand the award-winning program at Little Sprouts to additional locations, supporting AEG’s plan to take best practices from its various grade levels and duplicate them. The school has been recognized by the U. S Department of Education, with a Preschool Center of Excellence award in 2006 and a total of $5 million in Early Reading First grants.

“Little Sprouts has nice qualities for us, synergies we can offer to future pre-Ks,” Ruppert said. “We think it has huge growth potential. We can open a lot of Little Sprouts centers, not just in Boston, but in other part of the country.”

AEG may open as many as six new Little Spouts in Boston, he said, adding, “We expect in the future we will add grade schools in areas where we have them. We’ll have three or four Little Sprouts centers feeding into AEG grade schools.”

Little Sprouts was founded in 1982 by Susan Leger-Ferraro and now serves 1,200 children.

“Little Sprouts shares American Education Group’s vision and core set of values in setting a new standard for student-centered education,” said Leger-Ferraro, who becomes an AEG stockholder and retains her role as Little Sprouts president.

The acquisition is AEG’s third since it was formed last year with a $40 million investment from Winona Capital Management and Chicago Growth Partners, private equity firms. Tampa Day School, which AEG purchased in December, serves 140 kindergartners through eighth graders. The first purchase was New Jersey’s Barnstable Academy for 130 middle and high school students.

Both are college prep schools, Ruppert said, with Tampa Day offering a focus on youngsters with learning and emotional challenges. He said AEG intends to open additional, similar schools. “It’s a great school with a lot of growth potential and replication opportunity,” he said.

Those two elements are key as AEG continues to build its focus on preparing students with learning challenges for higher education, Ruppert said.

“We’re one of the first to enter this business with the idea of building a national group of highly successful college prep schools with a different focus,” he said. “Although we are broadly defining our business as college preparatory schools, we have a specialty niche within that.”

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