A successful childcare operator had been aggressively expanding their portfolio, opening or acquiring up to six centres a year, largely funded through their own cash flow.

Their next opportunity was a well-located centre in Sydney’s Inner West that aligned with their geographic footprint and long-term strategy. The purchase price had been negotiated down, making it an attractive acquisition.

There was just one problem: timing. The owner had a strict three-month deadline to settle. Without funding in place, they risked losing a substantial deposit, missing out on a strategically important site and disrupting their growth pipeline.

Given the client’s rapid expansion model, a simple, off-the-shelf loan would not support their broader plans.

With a deep understanding of the childcare sector, Ligo Finance was able to find a solution. We developed a two-part funding solution tailored to the operator’s business model and expansion pace.

First, equity was released from an existing unencumbered centre to create immediate funding capacity. Additional lending was then secured against the new acquisition to complete the purchase and cover the six-month rental bond.

Second, a working capital facility was established against Child Care Subsidy payments. This created a reusable funding source for future rental bonds, supporting a more scalable approach to growth.

The result was a successful, on-time settlement with no strain on operating cash flow. The new centre was integrated smoothly into the portfolio, and day-to-day operations remained unaffected.

Importantly, the solution also provided a clear 18-month funding pathway to support continued acquisitions.

With funding aligned to their strategy, the operator could keep expanding without worrying about where growth capital would come from.

Planning your next childcare acquisition? The right funding structure can make expansion smoother and less stressful. Speak to Ligo Finance about your options.

‍