short selling same old storey, page-7

For MS point of view. MS bought the equity in the US venture at a great price xPE like the announcement said, also at a time of economic downturn so they get a great price. In three years' time the economy would have recovered, the US venture will most likely have improved, since the transaction is in $US, MS don't need to factor in any forex depreciation.

ABS on the other hand bought in during economic boom, funded it through debt. Now its not even operating its centres optimally. The MS deal does cut down the debt, but it comes in the form of a realised loss on the US venture. While the debt reduction has occurred, the reduced earnings and existing debt will weigh on this company like a stone.

1) The banks will take the deal, they dont care about shareholders or kids, they just want their money back in times of uncertainty.
2) MS saw the original deal was overpriced, and they don't want a part of ABS (they didn't take the 10%). So they haggled at their own leisure for a substantial reduction (approx 10% less in nominal terms not including some fine details) and got the centres at a valuation less than what ABS paid for, they ignored the fact that ABS poured money into the US ventures in renovation and other expenditures.
3) The childcare business is there to be operated, but ABS management have lost its shine, it will be weigh down by debt and earning problems. The road to recovery for ABS will be a long one, I'm not sure ABS can even recover from this blunder.

i'll KISS, unless ABS can make a dramatic turnaround in it's Australian operations, it will be a very long winter. Any SP movement will not be supported by fundamentals.