Buyout Deal to Affect 20 Local Child-Care Centers
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Thursday, May 8, 2008
The shareholders of Bright Horizons Family Solutions, the nation's largest provider of employer-sponsored child care, yesterday approved the company's acquisition by an affiliate of Boston private-equity firm Bain Capital Partners.
Of the 80 percent of outstanding shares that chose to vote, 98.9 percent voted in favor of Bain's bid. Bain intends to take the company private once the $1.3 billion transaction is completed at the end of this month.
Bright Horizons operates more than 600 early-care and family centers in the United States, Britain, Ireland and Canada. There are about 20 in the Washington region, spokeswoman Ilene Serpa said.
A quarter of the centers are sponsored by federal government agencies such as the Department of Energy and the Federal Energy Regulatory Commission. The company also has arrangements with such private employers such as law firms Arnold & Porter and Crowell & Moring.
Under the deal, announced in January, Bright Horizons shareholders are to receive $48.25 for each share of stock, 45 percent higher than the Jan. 11 closing price. To pay for the acquisition, Bain will shell out $640 million of its own money and borrow $850 million.
The Service Employees International Union, which represents child-care workers but not Bright Horizon employees, has criticized the financing arrangement as well as millions of dollars' worth of shares that a handful of top executives are expected to reap.
The union recently sent a letter to executives of Bain and Bright Horizons asking that "the costs of the buyout not be taken out of staffing and other operations -- cuts that would effectively pass the costs on to children and families," according to an SEIU news release.
In a January statement, Bain Managing Director Andrew Balson said his firm would "fully support Bright Horizons in continuing to deliver on its well-established reputation for providing employers and parents with the highest-quality child care, early education and work/life solutions."
Bright Horizon shares closed at $47.63, up 0.23 percent.
