Private equity news usa TA and Warburg Pincus Look to Offload Procare child-care software for up to $2bil

TA and Warburg Pincus Look to Offload Procare child-care software for up to $2bil

Procare Solutions, a child-care management software provider, is reportedly up for sale, and its private equity owners, TA Associates and Warburg Pincus, are hoping to fetch a valuation of nearly $2 billion, including debt.

William Blair has been hired as an investment bank to advise Procare on its sale process, which is expected to launch after Labor Day. The auction is expected to attract interest from private equity firms.

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Procare, based in Medford, Oregon, offers business management software, payments technology, and other technology services to the child-care industry. It has over 37,000 child care centers, pre-schools, daycare centers, and after-school programs and camps as its customers.

The company also supplies its customers with hardware, including biometric-enabled computers, fingerprint readers, electronic signature tablets, keyless entry systems, and card readers for payments.

According to sources, Procare generated earnings before interest, taxes, depreciation, and amortization (EBITDA) of approximately $70 million last year, and it expects cash flow to reach $100 million in 2023.

The company has grown primarily through acquisitions of child-care software startups such as Cirrus Group LLC, KidReports, Kinderlime Inc, and SchoolLeader.

TA Associates acquired a majority stake in Procare in May 2015 and sold a portion of its stake in the company to Warburg Pincus in 2018. Neither Procare, TA Associates, Warburg Pincus, nor William Blair have commented on the matter.