This article is from the Australian Property Journal archive
ABC Learning Centres' Australian business owes more than $1.6 billion and Morgan Stanley and the Singapore Government are looking to launch legal action, according to administrators.
Insolvency firm Ferrier Hodgson’s Greg Moloney said ABC owes more than $900 million to secured creditors.
ABC Learning operates 1200 childcare centres in Australia and New Zealand. The company was placed into voluntary administration earlier this month owing over $1 billion in debt.
Receivers McGrathNicol’s Chris Honey said despite reports that 40% of centres were unviable they could continue to operate.
“Previously, the company’s focus has been on growth. Our focus is 100% on the operation of the company’s existing facilities,” he added.
Meanwhile, it is believed that the Singapore Government’s investment firm Temasek and global financial services company Morgan Stanley are looking at launching legal action against ABC over misleading and deceptive conduct.
In May this year, ABC’s then chief executive Eddy Groves convinced Temasek to buy a 12% stake in the company for $402 million.
And in June ABC completed an $82.2 million placement to Morgan Stanley giving it a 15% stake in the company.
It is also believed that angry shareholders want to launch a class action against the ABC and its former directors.
Meanwhile Austock yesterday revealed it is owed $4.4 million which relates to $3.2 million in balance of unpaid fees for the advice by Austock Corporate Finance Pty Ltd in regard to the sale of the ABC US business to Morgan Stanley Private Equity completed in June
2008; and $1.2 million for property services rendered by Austock Property Services Pty Ltd since July 01 2008.
Australian Property Journal
