Ann: Embark market update, page-20

Interesting article in The Australian. The review into the industry at least gives us some idea of why this sitting duck is still sitting.

Dealmakers working on childcare businesses Affinity Education and Guardian Early Learning are expected to wait until the outcome of a review into the industry by the competition watchdog before pulling the trigger on the sale processes of the businesses.

Guardian is believed to be generating between $80m and $100m of annual earnings before interest, tax, depreciation and amortisation.

Sources believe that the business is likely to sell for up to 12 times earnings, which could mean it is on offer for a price well over $1bn.

Now, there's a good chance that someone working on the deal on behalf of the vendor is the one who is talking to the papers and wants to pump the value up, but I tell you what, if this deal gets done at 12x, then EVO is worth way north of $1.20.

Again, it's hard to see how this isn't taken out at some point once the details of the review are finalised.