Nido Education Ltd (ASX:NDO) has completed the $9.1 million acquisition of 4 childcare services from its incubators, adding 348 licensed places across South Australia and Western Australia.
The acquired centres are expected to generate annualised EBITDA of $1.9 million before AASB16 adjustments, with an average daily fee of $197. The services have been open for an average of 140 weeks, providing an operating history for Nido as it integrates them into its national early childhood education and care platform.
The transaction forms part of Nido’s incubator model, under which new childcare services are developed before being acquired into the listed company once they meet required operating metrics.
Nido said demand conditions across the childcare sector remained challenging, but new services continued to open in line with expectations. The company said it would maintain a disciplined approach to site selection, focusing on long-term performance.
The company is also assessing acquisition opportunities outside its greenfields incubation pipeline, with due diligence underway on several assets. It said any acquisitions would need to meet commercial and performance requirements while aligning with Nido’s operating model and quality standards.
About Nido
Founded in 2021, Nido owns, operates and manages long day early childhood education and care services under the Nido Early School brand.
Nido traces its origins to Think Childcare Ltd (ASX:TNK), which listed in 2014 at $1 per share and a market capitalisation of $39.4 million before being sold in 2021 for $3.28 per share, including a dividend, valuing the company at $220 million.
That transaction delivered TNK investors a 4-fold return over seven years, including dividends, and many of Nido’s founding shareholders were also investors in TNK.
Nido was formed after TNK’s former managing director and CEO acquired 16 new but loss-making childcare services, the head office team and the Nido brand from TNK.
The company said the Nido story was not complete, with further communities yet to experience its early childhood education model and the team behind the brand continuing its work with children and families.
In 2022, Nido established a joint venture with incubation partner Alceon to develop 100 new services over five years.
Two years later, Nido listed on the ASX, giving investors the opportunity to participate in the company’s growth and support a business focused on early childhood education, children, families and teachers.
As part of the IPO, all Nido employees were issued equity in recognition of their commitment to the company and their role in building the business.
Nido said its objective was to deliver shareholder returns through dividends and expected share price growth, while also supporting positive outcomes for children and the broader community.