Evolve acquires a further 5 ECEC centres across Queensland and Victoria
Evolve Education Group have confirmed they have contracted to acquire five early childhood education and care (ECEC) centres in Queensland and Victoria, with a combined total of 456 license places and around $1.8 million of earnings before interest and tax (EBIT).
The centres will be acquired for an initial upfront payment of $7.65 million, followed by a further $1.5 million paid to the vendors if combined earnings before interest and tax (EBIT) exceeds $2.5 million by 31 December 2020.
Should the December 2020 EBIT target not be achieved no further payment will be made to the vendors and the Group will instead retain the benefit of any additional earnings generated for no additional consideration.
The transaction will be funded by way of $4 million of existing cash reserves and $3.65 million in new Evolve shares at a confirmed price of $0.15 a share with any deferred consideration, should the earnouts be achieved,payable in either shares, on the same terms, or cash.
Overall the Group now has a total portfolio of 10 centres of 966 licence places generating around $4.92 million in current annualised EBIT at a cost of $21.9 million of which $18.25 million will be paid in cash and the balance in shares.
Cash remaining on balance sheet for further acquisitions will be around $5.5 million.
Commenting on the acquisition Group Managing Director Chris Scott said “The acquisition sets up our first cluster in Queensland and further strengthens out operational presence in Melbourne.”
Further information on Evolve announcement please click here.