19 February 2013 Contracts to acquire 12 premium childcare and education centres Listed Queensland-based childcare and education centre operator G8 Education Limited (ASX: GEM) is pleased to announce that it has contracted to acquire 12 premium childcare and education centres from a number of different vendors. The childcare and education centres are located in New South Wales and Victoria. Business acquisition contracts have been executed, conditional upon customary licensing approvals and finance. Subject to these conditions being satisfied the acquisitions are expected to settle before the end of April 2013. The purchase price for the 12 centres is $18.7 million which represents 4 times anticipated EBIT for the 12 months post settlement. $16.6 million is payable at settlement and a further payment of $2.1 million is conditional upon the centre based EBIT target being achieved in the 12 months post settlement. G8 Education Limited Managing Director, Chris Scott, said: “The acquisition of these 12 premium centres is significant to G8 Education’s expansion and will add 871 licensed places to the Group. The 12 centres are expected to contribute to EBIT immediately upon settlement.”
GEM Price at posting:
$1.64 Sentiment: Buy Disclosure: Held
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