GEM - G8 Education

[Plumber1]

I am thinking about investing in this company (G8 Education). But I read some news yesterday that a company that they are buying is going into receivership(see below).

Does anyone know much about this company? It has Jennifer Hutson (from Wellington Capital)as Chairperson and Chris Scott (formerly of MFS Octaviar) as Managing Director.

https://www.aussiestockforums.com/forums/showthread.php?t=10937&p=621976&viewfull=1#post621976


http://www.channelnewsasia.com/stories/singaporelocalnews/view/1118654/1/.html

All advise would be appreciated.

 

[ROE]

I am thinking about investing in this company (G8 Education). But I read some news yesterday that a company that they are buying is going into receivership(see below).

Does anyone know much about this company? It has Jennifer Hutson (from Wellington Capital)as Chairperson and Chris Scott (formerly of MFS Octaviar) as Managing Director.

https://www.aussiestockforums.com/forums/showthread.php?t=10937&p=621976&viewfull=1#post621976




http://www.channelnewsasia.com/stories/singaporelocalnews/view/1118654/1/.html

All advise would be appreciated.

This one on my radar to short something bad
Very bad fundamentals

I cant work out how I can do it with comsec though

 

[Plumber1]

Why do you think it will go down ?

 

[VSntchr]

Totally agree ROE.
My dad insists on buying GEM due to Chris Scott being in the management (regarding his involvement with S8).
I do not understand why he says sometimes you just have to buy based on the management.
My argument is that the management is only as good as the figures they achieve..he doesn't seem to listen!!!

 

[Plumber1]

Today, I have been doing a heap of research on this company and its directors.

Chris Scott
It seems that Chris Scott did well in S8 (even if he was a little naughty http://www.goldcoast.com.au/article/2010/12/15/276795_gold-coast-business.html ). Mr Scott received a life ban from obtaining a licence under Queensland's Property Agents & Motor Dealers Act or from becoming an executive of a company with such a licence. Mr Scott was also ordered to pay $130,000 plus the OFT's costs of $66,000.

I also read that he sold his interests in S8 for shares in MFS which then failed, so he did not end up with too much for all his efforts in S8

Jennifer Hutson
The current chairperson of Wellington Capital. It seems that there is a long and twisted saga that is incredibly complex involving Wellington Capital and some other companies. https://www.aussiestockforums.com/forums/showthread.php?t=10937&page=332
(After a couple of hours of reading that thread my head was done in).

Andrew Kemp
Andrew Kemp formerly of S8 has joined the G8 Education board

I am still interested in investing in this company. But is anyone here have anything they want to add to the thread before I jump in?

 

[seamisty]

Today, I have been doing a heap of research on this company and its directors.

Chris Scott
It seems that Chris Scott did well in S8 (even if he was a little naughty http://www.goldcoast.com.au/article/2010/12/15/276795_gold-coast-business.html ). Mr Scott received a life ban from obtaining a licence under Queensland's Property Agents & Motor Dealers Act or from becoming an executive of a company with such a licence. Mr Scott was also ordered to pay $130,000 plus the OFT's costs of $66,000.

I also read that he sold his interests in S8 for shares in MFS which then failed, so he did not end up with too much for all his efforts in S8

Jennifer Hutson
The current chairperson of Wellington Capital. It seems that there is a long and twisted saga that is incredibly complex involving Wellington Capital and some other companies. https://www.aussiestockforums.com/forums/showthread.php?t=10937&page=332
(After a couple of hours of reading that thread my head was done in).

Andrew Kemp
Andrew Kemp formerly of S8 has joined the G8 Education board

I am still interested in investing in this company. But is anyone here have anything they want to add to the thread before I jump in?

Do some more homework!! http://wincrt.blogspot.com/2011/03/valuebuddiescom-forum-for-value_28.html#2


CHILDCARE operator G8 is facing a legal challenge in Singapore after the souring of its first international deal.

Full article
http://www.couriermail.com.au/ipad/...s-deal-goes-sour/story-fn6ck2gb-1226031635727

http://www.todayonline.com/Singapore/EDC110331-0000067/Six-childcare-chain-staff-dismissed-by-SMS

 

[Plumber1]

Seamisty,

Do you have any any updates to this matter?

 

[seamisty]

Plumber1, I posted this earlier on the Wellington Capital PIF/Octaviar (MFS) PIF thread:: I assume you are aware that GEM is in a trading Halt and no announcement has been made to the ASX as yet in relation to the following possible serious financial implications to the company and shareholders?


Cherie Hearts Group International Pte Ltd

15th April 2011
MEDIA RELEASE FROM CHERIE HEARTS GROUP INTERNATIONAL PTE LTD TO SINGAPORE
MEDIA
We are pleased to inform that the Singapore High Court on 14th April 2011, granted various interim
reliefs in our favour at today’s hearing on our application for various injunctive reliefs against G8
Education Ltd (“G8”). At the hearing, we were represented by our lawyers, Allen & Gledhill LLP.
Pending the determination of the substantive dispute between Cherie Hearts Group International Pte Ltd
(“Cherie Hearts”) and G8, the Court ordered the following injunctive reliefs:
• The appointment of KordaMentha Pte Ltd as receivers of Cherie Hearts is set aside.
• G8 is not to exercise its right to appoint further receiver(s) until trial or further order.
• The shares and directorship in the following subsidiaries of Cherie Hearts, which were previously
transferred to G8’s subsidiary, were reinstated to Cherie Hearts’ Founders, Dr Sam Yap and Dr
Gurchran Singh:
o Cherie Hearts Kids Cottage (TK);
o Cherie Hearts Edukidz Pte Ltd (JT);
o Cherie Hearts Discovery School Pte Ltd (TS 42);
o Cherie Hearts Preschool Pte Ltd (TP);
o Cherie Hearts Sunshine Kidz Pte Ltd (TS 34);
o Our Juniors’ Schoolhouse Pte Ltd;
o Cherie Hearts Childcare (Limbang) Pte Ltd (LD);
o Teeny Tiny Child Care & Development Centre Pte Ltd (TT);
o Loving Child Care Centre Pte Ltd (LLC);
o Loving Development Pte Ltd (LDC);
o Gloryland Learning Centre @ Toh Tuck Pte Ltd; and
o Gloryland Learning Centre Pte Ltd.
We take this opportunity to express our gratitude once again to our parents, financial institutions, banks
and government authorities for your support all these years, and also for the understanding shown over
the past few weeks. We look forward to having your continued support.
Yours Faithfully
Sam Yap Soon Guan (Dr.)
Group Executive Chairman
Cherie Hearts Group International

And this article as well, Cheers.
Re: Wellington Capital PIF/Octaviar (MFS) PIF
http://www.channelnewsasia.com/stori...123079/1/.html
Cherie Hearts suing Australian firm for breach of contract

SINGAPORE : Childcare operator Cherie Hearts is suing Australian firm G8 Education for breach of contract.

It has also successfully applied for a court order overturning a receivership appointment by G8, which the operator said was unlawful.

The move by G8 had put Cherie Hearts under threat of liquidation.

But while the operator appears to be out of the woods for now, its sale agreement with G8 is up in the air, with possible implications on future expansion plans by Cherie Hearts.

Lawyers for Cherie Hearts declined comment on the deal pending the outcome of the trial.

Last October, G8 agreed to buy over Cherie Hearts' Singapore operations for S$24.6 million, as part of a move by the Australian-listed firm to expand its childcare business into Singapore.

An affidavit submitted by Cherie Hearts detailed how, as part of the business acquisition contract, G8 would extend a S$12 million loan to Cherie Hearts and assume part of its outstanding debts.

The loan was to have been offset against the purchase price, and Cherie Hearts would receive some S$9 million once the sale was completed.

But on March 22, with a few weeks to go, receivers were called into the operator's Cecil Street headquarters, with G8 alleging a loan default of S$5.5 million.

This was disputed by Cherie Hearts, which said its loans had been effectively paid off as of March 1.

It later found out that G8 had also exercised its security over the alleged loan default, and, without its knowledge, assumed control of 12 of its subsidiary companies in Singapore.

Cherie Hearts has since assumed control of the 12 centres.

The case is now pending trial.

 

[Plumber1]

So it looks like G8 has lost about$12 million dollars that they loaned Cherie Hearts ??
And have been forced by the Courts to hand back the child care centres and now lost control of the company?
Not a good sign.

 

[Plumber1]

There seems to be too much drama with this company and especially its Management team.
I think I will look for better investments.

 

[NOR]

There seems to be too much drama with this company and especially its Management team.
I think I will look for better investments.

AS A VERY SAD INVESTOR IN MFS...PIF NOW WELLINGTON CAPITAL I AGREE GO LOOK VERY QUICK HOPE U HAVE BETTER LUCK THEN US WC J H WE WILL REMEMBER

 

[Plumber1]

The price has just hit 91c which is a new low for 2011.
Whew, I think I dodged a bullet by not buying into this share. I would have lost around 10% -15% in only a couple of weeks.
There seems to be too much drama associated with this company and especially its Management team.

 

[seamisty]

My information is that Cherie Hearts has terminated their agreement with G8 and have taken back legal rights to all the centres due to G8 having breached a number of clauses in the contract.
Also there are CPIB, ACRA and several other police investigations going on in regards to this case and Chris Scott is presently undergoing questioning.
The Accounting and Corporate Regulatory Authority (ACRA) is the national regulator of business entities and public accountants in Singapore. ACRA also plays the role of a facilitator for the development of business entities and the public accountancy profession. http://www.acra.gov.sg/

The Corrupt Practices Investigation Bureau (CPIB) is an independent body which investigates and aims to prevent corruption in the public and private sectors in Singapore. Established in 1952, it derives its powers of investigation from the Prevention of Corruption Act (Chapter 241). The bureau is headed by a director who is directly responsible to the Prime Minister. http://app.cpib.gov.sg/cpib_new/user...t.aspx?pgID=21
Wow, if this information is indeed correct, the ASX has not been notified and G8 continue to include potential revenue raised from these centres in their profit statements, while previously maintaining that this claim was 'beyond remote' in substance?

I am also of the understanding that several unhappy franchisees who have been novated over to G8 are acting/have acted to terminate their Franchise Agreements!!

Seamisty

 

[seamisty]

Hi all, Attatched are two files relating to G8 Education, the first correspondence is from Cherie Hearts relating to 'misleading information to G8 stakeholders' to the ASX, the second is from the HIGH COURT OF THE REPUBLIC OF
SINGAPORE. Interesting reading. Seamisty

 

[rmstrader]

Hi all, Attatched are two files relating to G8 Education, the first correspondence is from Cherie Hearts relating to 'misleading information to G8 stakeholders' to the ASX, the second is from the HIGH COURT OF THE REPUBLIC OF
SINGAPORE. Interesting reading. Seamisty

Seamistry - I am unable to find the letter written to the ASX from Cherie Hearts on the ASX site?? are you aware of its source?? It seems a bit bogus to me. Its not on Cherie Hearts letter head?? its not signed?? its either suss or a worry that such a letter is not on the companies official letterhead nor sign by the CEO??

 

[rmstrader]

Seamistry - I am unable to find the letter written to the ASX from Cherie Hearts on the ASX site?? are you aware of its source?? It seems a bit bogus to me. Its not on Cherie Hearts letter head?? its not signed?? its either suss or a worry that such a letter is not on the companies official letterhead nor sign by the CEO??

Seamisty - I pride my self on the research that I undertake when I buy any shares and while I am certainly not a big time trader if your in the game then play it right. I recently purchased a small parcel of G8 shares as I was alway impressed with the management team at S8 in terms of the financial results that they achieved. I've got to say that in the last 12 months they have done the same thing at G8.

I joined this site hoping that it would give me an extra edge in terms of market knowledge, but it seems to me that a lot of info that is disseminated is promoted for self benefit not Knowledge.

If you are going to put information on a site you need to be prepared to back it up - some far I have had NO acknowledgement or answers to my questions. Are you able to assist?

 

[Plumber1]

The price has just hit 91c which is a new low for 2011.
Whew, I think I dodged a bullet by not buying into this share. I would have lost around 10% -15% in only a couple of weeks.
There seems to be too much drama associated with this company and especially its Management team.

Wow, the price has now dropped to 72c.
I sure dodged a bullet by not buying this company. I would have lost another 20% since the above post just 10 weeks ago.

It looks like the Wellington Capital saga is affecting this company.

 

[ROE]

I done the figures on childcare business
you cannot make much money out of them.

they are in the same basket case as airlines..

to beat the market all you need is avoid ****ty business

most of the time I make great return by just avoiding
all the ****ty business...

Take heed in these Warren Buffett timeless advices..

'When a management with a reputation for brilliance tackles a business with a reputation for poor fundamental economics, it is the reputation of the business that remains intact.’

You can have the best managers in the world running an unsound business model
you still end up losing money...

 

[J12]

Quick update from Singapore for all those concerned;

In reference to the update by G8 Education Limited on their Singapore Acquisition and Litigation made on their website dated 14 July 2011, the 24 franchised centres are in fact, indirectly involved in the suit between Cherie Hearts Group International Pte Ltd (Cherie Hearts) and G8 Education Limited (G8). Cherie Hearts with effect of 25th April 2011, has terminated all agreements with G8. In the event that Cherie Hearts wins the suit, this would imply that Cherie Hearts will regain ownership of the franchised centres as well. With the termination of the agreements and without any financial closure, any and all IP rights remain the property of Cherie Hearts.

It is not entirely true that all profits derived from the 13 centres flow to G8. In fact, if Cherie Hearts wins the suit, G8 is to return all profits collected from all the centres beginning from March 2011 onwards to Cherie Hearts. Rightfully, G8 should allocate a portion of "contingent liabilities" in its accounts to cater for such suits, not forgetting the writ of summons served to G8 for claims of damages.

Lastly, on the matter of the 5 centres which G8 claims they acquired directly, Cherie Hearts will address that at the appropriate time and forum.

Do some more homework!! http://wincrt.blogspot.com/2011/03/valuebuddiescom-forum-for-value_28.html#2


CHILDCARE operator G8 is facing a legal challenge in Singapore after the souring of its first international deal.

Full article
http://www.couriermail.com.au/ipad/...s-deal-goes-sour/story-fn6ck2gb-1226031635727

http://www.todayonline.com/Singapore/EDC110331-0000067/Six-childcare-chain-staff-dismissed-by-SMS

 

[seamisty]

Quick update from Singapore for all those concerned;

In reference to the update by G8 Education Limited on their Singapore Acquisition and Litigation made on their website dated 14 July 2011, the 24 franchised centres are in fact, indirectly involved in the suit between Cherie Hearts Group International Pte Ltd (Cherie Hearts) and G8 Education Limited (G8). Cherie Hearts with effect of 25th April 2011, has terminated all agreements with G8. In the event that Cherie Hearts wins the suit, this would imply that Cherie Hearts will regain ownership of the franchised centres as well. With the termination of the agreements and without any financial closure, any and all IP rights remain the property of Cherie Hearts.

It is not entirely true that all profits derived from the 13 centres flow to G8. In fact, if Cherie Hearts wins the suit, G8 is to return all profits collected from all the centres beginning from March 2011 onwards to Cherie Hearts. Rightfully, G8 should allocate a portion of "contingent liabilities" in its accounts to cater for such suits, not forgetting the writ of summons served to G8 for claims of damages.

Lastly, on the matter of the 5 centres which G8 claims they acquired directly, Cherie Hearts will address that at the appropriate time and forum.

Thats really interesting as there was a GEM announcement on the ASX today http://www.asx.com.au/asxpdf/20110720/pdf/41zvvyr7xrnv3b.pdf which showed a profit downgrade but made no mention of the possibility of having to return profits back to Cherie Hearts. It also made no mention of any' contingent liabilities' only a statement saying::
"The variance in the revised calendar year 2011 forecast in the consolidated group is primarily due to delayed settlement of the acquisitions in Singapore.

In addition there are one off legal due fees arising from the current litigation between G8 Education Limited and Cherie Hearts Group International (
the vendor).

In really small print it says:"# Excludes legal fees of $420,000 forecast to be incurred in relation to the litigation between CHGI and G8 Education Limited as these are considered non recurring expenses".

Anyway it was obvious the market did not like the announcement as there was a large sell off and the next bid is only for 67cents.

Might be the end of G8 divvies for awhile or are investors wary of management with all the adverse Wellington Capital/Ms Hutson media of late???
Seamisty