ABC Learning centres sold to charity for $1 each

May 3, 2009
Singapore Democrats

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The Australian

Failed childcare centres reliant on taxpayer funding have been sold to a charity for $1 each.

Mission Australia paid a token $1 each for several of the 29 ABC Learning centres it bought from the collapsed childcare chain’s receiver, PPB, industry sources told The Australian yesterday.

PPB is refusing to reveal how much it received for 210centres, sold to 65 different buyers last week.

Mission Australia plans to use its 29 new centres in NSW, Victoria, South Australia, Western Australia and the Northern Territory to expand its Pathways program to help prepare disadvantaged young children for school.

“We got a really fantastic deal,” Mission Australia spokesman Paul Andrews said yesterday.

“We were able to secure favourable rent concessions and terms for some specific centres which helped balance the sustainability of the whole package.”

Mr Andrews would not say how many centres had been purchased for a token $1, citing commercial confidentiality.

He said Mission Australia was retaining the existing ABC childcare staff and predicted the centres would be “self-sustaining” within 18 months.

“Our ambition is about having a greater impact on families, particularly those doing it tough in disadvantaged areas,” he said.

“The problems that ABC had in terms of viability of the centres we don’t, because we have a completely different model – we’re not having to support shareholders.”

PPB partner Stephen Parbery, who was appointed by the Federal Court to sell 241 centres deemed unviable by ABC Learning’s co-receiver, McGrathNicol, said yesterday sales figures would be provided to the court once the sale process was completed.

“For commercial reasons we do not believe it is in the interest of the sale process to make any announcements about sale proceeds until after the completion dates of all contracts,” he told The Australian.

Mr Parbery said some of the proceeds would be paid to PPB for “chattels” – such as childcare equipment – owned by ABC.

Part of the proceeds would be repaid to the federal Government, which has given the two receivers $56 million of taxpayer funds to keep the centres running until they are sold. Any leftover funds would be paid to ABC Learning’s creditors, who are owed $1.6 billion.

Mr Parbery refused to say how much taxpayers could expect to recoup on the deal, or how many centres had been sold for token payments.

http://www.theaustralian.news.com.au/business/story/0,28124,25372765-36418,00.html