Curro has added a 40th school to it’s admirable stable of private schools by acquiring St Dominic’s Academy in Newcastle. An obvious choice for this school-hungry company, but it does raise questions about the Catholic Church and other religious institutions relinquishing their control of the youth’s education. Alec Hogg talks to CE of Curro, Chris van der Merwe about Curro’s plans for the future, assimilating a Catholic school into the portfolio and thoughts about African expansion. -CP
ALEC HOGG: Curro Holdings has further strengthened its presence in KwaZulu Natal with the acquisition of one of the oldest independent schools in the country: the 123-year old St Dominic’s Academy in Newcastle. The company CEO Chris van der Merwe is on the line. I wasn’t kidding, Chris. I used to visit the girls from St Dominic’s from time to time, growing up in Newcastle. At the time, it was a ‘girls only’ school, but proud tradition. At the time though, it was also owned by the Catholic Church. How does a Catholic school become owned by Curro?
CHRIS VAN DER MERWE: Good afternoon. Many of these schools have wonderful facilities but at a certain stage, when you want to enhance the school’s standard, you need some capital, some curriculum experts, and some people who understand the art of enhancing the school by means of developing the facilities. That’s why we did the deal. We believe that we can grow the school by using their beautiful earth, and developing their facilities and curriculum further.
ALEC HOGG: But what happens to the Catholic Church? Do they actually sell it to you?
CHRIS VAN DER MERWE: Yes, indeed. It is a transaction between them and us and physically, an acquisition where we take the school over and declare full ownership.
GUGULETHU MFUPHI: The staff, Chris…are you looking to retain them?
CHRIS VAN DER MERWE: Whenever we take over a school like that, we retrain the staff and obviously, since we have 40 schools in our company all kinds of opportunities arise for those staff members to apply for promotion posts, too. Indeed, we’ll take over the staff just like that and for every X number of units that we gain at the campus, we’re obviously appointing new staff members.
ALEC HOGG: But this is an interesting point. Have you bought a school from a church or more particularly, the Catholic Church before?
CHRIS VAN DER MERWE: Just come again.
ALEC HOGG: Have you bought a school from the church or from the Catholic Church before?
CHRIS VAN DER MERWE: We haven’t bought a school from a Catholic Church, but we’ve purchased one in Hillcrest and it actually, works very well indeed.
ALEC HOGG: But it’s interesting that for years, the churches had church schools – Marist Brothers, for instance as well as many others around the country – and some famous ones. Are we now seeing a trend where the church itself is saying ‘we are quite happy to sell to a private institution like yours’?
CHRIS VAN DER MERWE: Indeed. We think that’s happening. In the past, obviously the church declared ownership of these schools. Once you declare ownership though, it comes with many responsibilities and the biggest one is to commit yourself to huge capital layouts, especially if you want to develop the high school component of these schools. In addition, if you want to develop these schools to reach numbers of above 1000 learners, it becomes capital-intensive. We are definitely seeing churches now, a couple of years after Curro has entered the market, fully understand that a school can actually make profit as well as provide a great educational service. The whole perception about this moneymaking thing in schools, changed very positively over the past few years.
GUGULETHU MFUPHI: Chris, what do you make of your competitors, AdvTech, and the recent announcements they’ve made?
CHRIS VAN DER MERWE: Obviously, AdvTech had to enhance their number of schools because it was clearly, evident – if you look at what happened to Curro – that the market, in terms of the willingness of parents across the spectrum to support private schools, is really much bigger than all the groups ever guessed. I think that the market is there. I think there’s enough space for Curro and AdvTech, as well as a couple of other role players to develop quite rapidly. Strategically, I think it was the obvious choice of Leslie Maasdorp to also understand that one could grow aggressively.
ALEC HOGG: Chris, it’s interesting that they are following the Curro Rule Book, but are you going to follow them into other parts of Africa? This week, we saw AdvTech doing its first non-South African deal and (they say) the first of many.
CHRIS VAN DER MERWE: We have a particular orientation towards the push in Africa. We say that we are firstly, here to help the South African society out. If I take a 36-month view of our opportunities, we definitely have more than about seven opportunities per annum towards the next three years. Although we are also busy doing our research, we will first help the South African nation out.
GUGULETHU MFUPHI: Just on the South African environment, which provinces are hungrier for private education?
CHRIS VAN DER MERWE: Currently, it’s in all the provinces. Interestingly, our 40th school is now in the completion phase and it’s in a small dorpie called Kathu. It’s in that mining region next to Kumba mines. We are seeing opportunities in all the provinces but the three provinces that really, show potential is number one as well as in that order, is Gauteng Province, followed by Kwa-Zulu Natal, followed by Western Province. These three are undoubtedly, the predominant role players.
ALEC HOGG: That was Chris van der Merwe, the Chief Executive of Curro.
