There is huge potential in The Affinity centres. A large percentage of centres, when acquired by Affinity were reporting occupancy levels 90% +. Two years after acquisition, the occupancy levels, in many of the centres had fallen considerably.
Anchorage paid $21,500 per licensed place for Affinity centres. G8's latest acquisitions, due to settle this month have been purchased for $29,700 per licensed place.
I would expect that both Anchorage and G8 will be waiting until mid February before having a close look at occupancy levels, the increased employee costs and possible loss of income from the new legislated ratio levels introduced on 1st January. IMO we may see both Anchorage and G8 off load non performing centres during 2016.
Michael Henshaw from Petra Capital stated "Anchorage is likely to have its eye on further acquisitions to create value. From Anchorages perspective, we assume it will be looking to further consolidate the childcare market, both through centre acquisitions and corporate M & A".
Certainly an interesting year ahead.
GEM Price at posting:
$3.44 Sentiment: None Disclosure: Not Held
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