G8 Education Limited to acquire 19 early education and childcare centres

Listed early education and childcare centre operator G8 Education Limited (“G8” or the “Group”) (ASX: GEM) is pleased to announce that it has contracts in place to acquire a portfolio of 19 existing early education and childcare centres from a single vendor.

The total purchase price for the 19 centres is $27.0 million, representing a 3.75 times multiple of purchased EBIT of $7.2m. G8 will fund the acquisition from existing cash and finance reserves.

The portfolio is made up of six centres in Queensland, five in New South Wales and eight in Victoria, with the centres being complementary to G8’s existing portfolio.

G8 has contractual arrangements with each centre, conditional upon customary licensing and landlord approvals. Subject to these and other appropriate conditions being satisfied, the acquisitions are expected to settle before the end of October 2017.

G8 Managing Director, Gary Carroll, said: “The acquisition represents a positive opportunity for the Group to grow its portfolio by acquiring high quality operating centres in complementary locations at an attractive multiple.”

The centres are in addition to the previously disclosed pipeline and are expected to contribute approximately $1m in EBIT for the 2017 financial year, subject to timing of settlement.

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