Refinance Package Sees Childcare Chain Enjoy A Growth Spurt

Bertram Nursery Group

The expansion of Bertram Nursery Group was hampered by cashflow constraints: restructured finances allowed the company to expand

In Brief

  • Company turnover: c. £14-15 million
  • Sector: Childcare
  • Within 12 years, the Bertram Nursery Group has grown from a single nursery to a business with 34 premises and 740 staff, and is now a leading childcare provider in Scotland and the North West.
  • Bertram needed funding for acquisition, but their incumbent bank was constraining cashflow.
  • Santander restructured Bertram’s debt, freeing up £1 million a year to be reinvested in the business in the form of expansion and innovation.
  • The company has now successfully acquired a number of nursery premises and has already spent £120,000 on improvements including software and staff training.
  • Having re-banked with Santander, Bertram have since announced plans to increase its number of childcare places by 300, which will create around 100 new jobs.


Graeme Scott, CEO of the Bertram Nursery Group, is committed to constantly improving the service at his nurseries. This commitment is clearly evident at Holyrood Nursery in Liverpool’s Princes Dock, which is one of the newest premises in Bertram’s 34-strong portfolio. Here, the standard nursery set-up has been re-worked to create a carefully considered environment that combines education and social development. Many of Bertram’s nurseries offer extra services like children’s hairdressing, parcel acceptance and dry cleaning collection.

This attention to detail has helped Bertram to become one of the UK’s largest independent nursery groups, but Graeme had big plans for the business from an early stage. Having bought and sold a document storage company in his early twenties, he had the capital to move into property and opened a single nursery in Edinburgh. Once he had a foothold in the sector, Graeme was able to add more nurseries to his portfolio and formed the Bertram Nursery Group in 2007.

An independent operator 

This sector requires continual investment in order to drive expansion, and fund innovation and improvements. This was previously achieved by investment from Graeme and by debt in the form of £18 million provided by the company’s incumbent bank. This type of funding was vital for Graeme’s vision for the company. “A lot of the bigger private equity-backed nursery groups are run to a clearly defined formula,” he says. “Their nurseries conform to a uniform brand. We take a different approach. We believe our nurseries are there to serve local communities and each one needs tailored support for that community.”

To preserve this individuality, each nursery within the Bertram Group is run as a semi-autonomous business with its own local management team and bank account. Businesses acquired by Bertram retain their original names while benefitting from a group-level commitment to investing in care, teaching, staff training and IT. With this strategy in place, the company continued with its programme of acquisition and expansion until – in 2008 – its incumbent bank asked the business to speed up repayment of its outstanding debt. “They took the view that any spare money we made should go back to them,” says Graeme. It was this deleveraging that led to the decision to look for alternative banking and Bertram approached a number of lenders, including Santander.

First impressions 

It was Santander Relationship Director Andy Jamieson who had initial contact with the company. “We could see that it was a successful business hampered by a restrictive debt profile,” he says. This positive first impression was confirmed by a closer inspection of the business. “They had a very good management team that had proven experience not just in the nursery industry but also in other sectors. We could also see they had high occupancy levels, a high retention rate and they had weathered the economic downturn well. The problem they were facing was cashflow,” says Andy.

Graeme believes the particular appeal of Santander lay in the approach of its people. “The team got to know us individually and we felt the approach of the team was sensible and pragmatic,” he says. In a sector that relies on team players and a personable, client-facing approach, this was important when it came to selecting a business bank.

Capital solutions 

With Santander on board, no time was wasted in providing a funding solution that addressed the immediate issue of debt repayment. Santander refinanced the existing debt with a restructured profile in order to reduce repayments and release funds that could be reinvested in the business. Although the deal was only announced in January 2013, it is already having an impact. “We’ve probably invested about £120,000 already,” says Graeme.

Once refinancing was in place, Bertram also transferred its general banking to Santander, which was no mean feat as it involved new accounts for each of the 34 business units, as well as head office. As Santander Customer Implementation Manager Andy Thomson explains, “The implementation has taken about four-and-a-half months to complete and we have developed very close working relationships with the Finance Director and Group Financial Controller. We took time to understand the operational business and I believe that this has helped make the transition to Santander as smooth as possible.”

The future 

Bertram is now one of the biggest nursery groups in Scotland and the North West of England, and currently employs 740 staff. Following the deal with Santander, Graeme announced plans to increase the number of childcare places by 300, to a total of 2,873, creating around 100 new jobs in the process. The company will also continue to improve its nurseries – cash is already being spent on IT systems and the development of facilities such as a model ‘play village’, which is set to be a major feature at the Princes Dock nursery.

With Bertram having recently won ‘Nursery Chain of the Year’ at the Nursery World Awards 2013, Graeme remains committed to growing the business according to his vision, treating each nursery as an individual enterprise and constantly striving to improve the pre-school experience for both children and parents. “We don’t really look at what our competitors are doing. We try to be our own most exacting critics and deliver the very best service we can,” he says.


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Relationship Director Comments


We could see they had high occupancy levels, a high retention rate and they had weathered the economic downturn well. The problem they were facing was cashflow.

Andy Jamieson, Relationship Director