Commercial Activities

School for sale?

Steve Chinn set up Mark College in 1986 and sold it two years ago. The transfer process was long and arduous, but was ultimately successful. Here, he outlines some of the issues he faced before, during and after the sale

I sold my school... it is easy to write that now, but when the sale took place in June 2005, it was a major milestone in my life. I had opened the school nearly 20 years earlier. In the subsequent two decades, it had not only achieved Beacon School status but also won the ISA Award for Excellence and a Sportsmark with distinction.

Selling something that has been such a huge part of one’s life is a major event and there were many lessons to be learned and adjustments to make.

New beginnings
Mark College was a successful school, academically and financially. It had an international reputation for teaching boys who were diagnosed as dyslexic, with one-third of its staff having written books about the problems of dyslexia. I decided to sell the school because, as I moved towards retirement age, I wanted to focus on my lecturing and writing work.

In the same way as one should when selling a house, I was selling a property that was tidy and well maintained. Part of my plan was to sell the college as a going concern, to protect my staff and pupils. I hoped that the school would retain the characteristics that I and my staff had nurtured in it since its inception.

“Letting potential buyers know of one’s intention to sell, while maintaining confidentiality, is a difficult task.”

When considering selling a school, discretion is paramount. Letting potential buyers know of one’s intention to sell, while maintaining confidentiality, is a difficult task. In the case of Mark College, this was made harder by the particular nature of the school.

“There are some guarantees that you will have to make for a further eighteen months after the sale.”

The right support
After choosing a specialist school broker to promote the sale, I chose a firm of solicitors that could offer me an experienced team to handle the negotiations with the buyer. This is not an area where your local solicitor will suffice. The legal fees are going to be substantial (possibly running to a high five-figure sum), but the risks of using the wrong legal team will be disastrous. It is likely that the purchaser will have an experienced team behind them, so you need to match the quality of their advice.

The volume of paperwork made an Ofsted inspection’s demands look quite reasonable. I generated eight files at my solicitors, each four inches thick.

In the loop
Towards the end of the process, you are beholden to telling the staff, even though the sale will not have been completed and it could still fall through. At this point you are truly vulnerable. Your legal team and broker will be vital for reassurance and support.

Taking time
The sale will take months and is likely to be a stressful process. You have to maintain confidentiality during that phase, so the people whom you trust with this information, and you will have to trust some, should be chosen carefully. The stress of uncertainty is with you transfer beyond even the moment of signing contracts. There are some guarantees that you will have to make for a further eighteen months after the sale, such as one against financial liabilities, another against the risk of being sued, and another for pupil and staff guarantees, all with the potential of penalising you financially up to the agreed value of the school.

Moving on
When the deed is done, it is important to have a financial adviser in place to deal with the monies before you let any euphoria take over. It is easy to spend money that you think you are going to be left with, rather than contemplate the reality of what you will actually get.

Final thoughts
Adjusting to your new status after the sale can be difficult. You have to switch from providing a round-the-clock omnipresence to having no involvement at all. It can be a great relief, but it took me a while to appreciate that I no longer had responsibility for fifty members of staff and eighty boys. I also felt that I could not adjust to being a kind of benign presence around the school. I had chosen the new owners and that what they did from then on was no longer my responsibility.

Dr Steve Chinn was the founder and chair of CReSTeD, and writes and lectures widely on dyslexia. He is also a consultant in the special schools sector for National SchoolTransfer (www.nationalschooltransfer.com). 

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