The Entertainer buys Early Learning Centre from Mothercare

Early Learning Centre (ELC) operates in 80 UK Mothercare stores in the UK and in 400 stores internationally through franchise partners and online.

The deal includes ELC’s stable of toy brands such as Happyland.

The Entertainer founder and executive chairman Gary Grant said: “We are delighted to add ELC to The Entertainer family. It comes with a rich history as a much-loved British brand, supporting parents and grandparents with their children’s early years’ learning, development and play.

“We will look to bring new life to the product offering while maintaining the high level of quality ELC is renowned for. By combining our experience with that of ELC’s passionate and capable partners around the world, we look forward to re-invigorating the brand for generations to come.”

The deal is the latest for The Entertainer, which in December bought 57-store Spanish toy retailer Poly.

Mothercare said the disposal was “the next step towards being free of bank debt”. It will receive £6m on completion of the deal, with up to £5.5m for inventory “due within a few months of completion” and £2m in earn-out fees over two years.

Net proceeds will be used to reduce the group’s bank debt.

Mothercare said: “While Mothercare has a solid presence in the toy market through the ELC brand, the group does not have the necessary capital, resources or scale in this category to continue to invest and develop the own‑brand ELC toys needed to maximise returns from this specialist brand. 

“Furthermore, in the intensely competitive toy market, where third-party and branded product is key to a successful customer offer, especially in the older age ranges, we lack the scale to construct a compelling product range to achieve acceptable margins.”