please explain........

Why has a company that is "on the brink of collapse", as our beloved media is reporting, just spent $70 million buying a recruitment business? Only announced at the end of September..

I understand there are questions as to whether this was a related party transaction for which ABC has become famous? Maybe true but the company line doesn't at all match the media reporting.

Could these rumors be somehow related to the current ban on short selling? The ban came into effect after ABC was suspended from trading. Leaking rumors of an imminent collapse would be helpful for short sellers. I imagine shorters wanting to buy back in would appreciate some scared sellers!

The truth is out there somewhere..... No announcements from the company as yet and the media reporting seems timed to coincide with the company coming out of suspension some time in October.

Am I the only one who is suspicious?


30 September 2008
A.B.C. Learning Centres Limited (“ABC”) has today entered into an agreement to purchase the 123 Careers childcare recruitment business in Australia and New Zealand for $70 million from existing cash with a proposed settlement date of 10th October. $40 million has been paid by way of deposit with a further $25 million being paid on completion. The remaining $5 million will be paid by five monthly payments of $1 million each