A family-owned childcare operator in Western Sydney had built an impressive foundation. After acquiring an underperforming 41-place centre with cash, they increased occupancy from 35% to 72% within nine months through strong operational management and local community engagement.

With one successful centre operating and ambitions to expand, the owners wanted to release equity from their business and position themselves to acquire additional centres. However, although they had improved the performance of another recently acquired service, occupancy was still sitting below the minimum threshold required by many lenders. This limited their ability to demonstrate borrowing capacity and fund future acquisitions.

Ligo Finance worked closely with the operators to assess both their existing business performance and future growth plans.

By leveraging equity within the group's property assets and assessing future maintainable earnings, we structured a solution that enabled the release of equity while also establishing borrowing capacity based on annualised future cash flows.

During our review of multiple acquisition opportunities, we identified that many centres on the market were not aligned with the owners' strategy of building a geographically connected portfolio. Through our extensive industry network, we introduced the client to an opportunity to acquire three established centres within the Western Sydney region.

To support the transaction, Ligo arranged:

  • An equity release facility
  • Pre-approval funding for the acquisition of three additional centres
  • Strategic debt structuring to support cash flow during transition
  • Interest-only lending to minimise initial repayment pressure
  • A bank guarantee facility to support multiple leasehold properties

Within just 18 months of beginning their childcare ownership journey, the client successfully expanded from one centre to four.

The acquisition strengthened the group's cash flow, increased operational scale, and positioned the business for future growth. By structuring finance around the operators' long-term objectives rather than simply today's numbers, Ligo helped transform a single-centre operator into a growing multi-site childcare group.