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Kido International, a UK-headquartered firm specialising in preschool and daycare services, has acquired Amelio Early Education, a preschool and daycare operator in India.

The terms of the current transaction, including its size, were not disclosed. The acquisition follows the closing of a $7.5 million initial institutional funding round led by Tanas Capital, a Singapore-based private investment firm, with participation from individual investors. Prior to this, the company had secured funding from private investors.

The infusion of fresh capital will help the UK-headquartered international preschool chain’s growth ambitions, fuelling both organic development and strategic acquisitions globally, with a specific emphasis on expanding its footprint in India, said the company in a statement.

The acquisition of Amelio, which marks the initiation of this expansion, enables Kido to extend its premium early years education and care services to a broader audience in India.

Founded in 2008, Amelio has been providing childcare services in India for over 13 years. It operates 30 centres in Chennai, Bengaluru, and Hyderabad, with multiple locations catering specifically to corporate childcare requirements.

Speaking about company’s plans in India, Arpita Sur, CEO of Kido International, told YourStory, “We want to be one of India’s largest players in this segment…we are going to grow organically and inorganically, through acquisitions. We wanted to make sure that we take that first step and develop a critical mass. So we have raised funds and we have acquired Amelio.”

“It is a very seamless dovetailing of the two companies coming together. There’s a lot of synergies as the value of systems is the same. We care about our people, teacher training, quality, and customer satisfaction. So those values are front and centre,” Sur added.

Kido’s primary market is the UK, with 14 centres. Apart from the UK, it operates four centres in the US and nine centres in India. With the addition of Amelio’s centres, Kido’s total count in India rises to 39, expanding its presence, particularly in the South Indian market, complementing its existing presence in cities like Mumbai, Pune, and Gurugram.

In 2019, the Kido brand was launched with an innovative curriculum, drawing from cutting-edge research on how children’s minds develop, and from best practices across almost 30 different pedagogies, including the classical ones of Montessori, Reggio Emilia, and Waldorf Steiner, according to Sur.

“The quality we offer parents is of international standard, with consistent operating manuals and curriculum across all our countries. It’s contextualised for Indian children, but the underlying framework is the same,” she noted.

Growth and expansion plans

For Kido, the growth rates in India are expected to be significantly higher, particularly with the acquisition, which essentially quadruples the size of its business in the country. After the acquisition, its employee count increased from 130 to 450.

Beyond the acquisition, Kido has outlined its immediate expansion plans in India and has identified promising markets across the country where it anticipates growth potential.

“In Noida, we already have a tie-up, with the school scheduled to open later this year. Additionally, we are in discussions for a couple of more schools in Pune, and similarly, talks are on with schools in Gurugram,” Sur remarked.

Kido’s long-term target, within five years, is to have approximately 300 centres, while in the medium term, within three years, it aims to reach at least 150 centres, as per Sur.

While the franchise strategy, a well-known concept in the market, allows for rapid growth, maintaining quality becomes challenging, especially when targeting the premium segment where high standards are expected by parents.

“We are being very careful to stay away from the franchise model, and we want to grow thoughtfully and deliberately in a way that we can always promise the parents what they are going to get,” Sur said.

Speaking of competition, Sur highlighted that other players in the segment, such as KLAY, Footprints, Vivero, and Ipsaa, are also offering their services.

“We have seen a push from some of the players in terms of growing their business,” she noted, adding that the market itself, along with the segment, is expanding, and parents’ awareness is increasing. Therefore, altogether, “there is enough and more market share to be had”.

To capitalise on this growing demand, the company plans to raise another round of funds within the next year or two.

Beyond India

The company said it plans to launch four additional centres in the UK by December 2024. Additionally, it is expanding in the US, with two new schools set to open in Houston and Austin by December, and further expansion planned in New York by early next year.

Currently, the business split between the UK, US, and India stands at 70%, 21%, and 9%, respectively.

While currently, the UK holds the largest share in terms of size, the US is poised to match the UK soon, and India is expected to offer the highest growth prospects five years down the line due to the vast opportunities present in this market, according to the company.

“Kido, with its carefully curated programme, balances a child’s need for care and intellectual stimulation. With its demonstrated record of executing this playbook at scale in the UK and the US, we are excited to partner with Kido Schools as it gears up to make a difference in India,” Amit Sharma, MD, Tanas Capital, said.

(The copy has been updated to reflect the completion of the acquisition.)