Eddy Groves decries single buyer of ABC Learning remnants

ABC Learning founder Eddy Groves has shot down plans to sell the remains of his failed childcare empire to a single buyer.

ABC Learning founder Eddy Groves has shot down plans to sell the remains of his failed childcare empire to a single buyer.

The company's receiver, McGrathNicol, yesterday announced it would sell 715 childcare centres by Christmas, to try to claw back some of the $1.6billion owed to creditors.

The fire sale of one in eight Australian long-daycare centres will affect about 100,000 children and their parents.

Mr Groves - who built ABC Learning into the world's biggest childcare corporation before quitting as chief executive five weeks before it fell into receivership last November - yesterday ruled out a buyback.

"I'm done with childcare - forever," he told The Australian. "The whole thing is just a joke."

Mr Groves said his new wife, childcare operator Viryan Collins-Rubie, would not be buying any of the centres either.

He warned that a single buyer would try to "steal" the 715 centres, and said the receivers would make more money by breaking up the group.

"I think they'd get a lot more money if they sold them as individual centres," he said.

"Selling in one line, people will want to steal it."

Macquarie Bank - which has been speculated as a possible buyer - refused to comment on its plans yesterday.

But other major childcare groups, which had bid for some of the 241 "unviable" ABC Learning centres sold in March, yesterday turned up their noses at the latest offering.

KU Children's Services - one of the nation's biggest not-for-profit operators - said it could not afford the centres.

"There's no way any not-for-profit would be able to afford some of the price tags they're talking about," said KU chief executive Sheridan Dudley.

"If they're selling it in one line, then it's more likely to be picked up by either a big private equity company or go offshore.

"This means that one large corporate operator will still completely dominate the market, just as ABC did before its collapse.

"Unless the sector is restructured to ensure no company can ever again dominate, another collapse of the magnitude of the ABC failure will always remain a possibility."

The federal government has spent $56 million keeping ABC centres operating since the company's collapse nine months ago. Most of the money went to prop up 241 centres McGrathNicol had deemed to be "unviable", which were then sold to dozens of different operators in March.

Children 21 - a consortium of community childcare centres, charities and a subsidiary of the Bendigo Bank set up to bid for the 241 centres - played down the prospect yesterday of bidding for any of the new centres on the market.

"How viable will they be if they are split up? And if they are not split up, do we end up with exactly what we had before, with families and children being exposed once more to the money market?" spokeswoman Bernadette Dunn asked.

Queensland's biggest community operator, C&K, said it could not afford to pay commercial rents and continue to provide childcare at high standards.

"We couldn't afford to pay commercial rents," C&K chief executive Barrie Elvish said.

"I hope they're not sold off to another single owner because it would be back to the future."

The biggest landlord to ABC Learning - Austock's Australian Education Trust, which owns about 200 of the centres for sale - ruled out any renegotiation of rents.