Evolve Education Group NZSE:EVO Stock Report

Insufficient new directors

No new directors have joined the board in the last 3 years. The company's board is composed of: No new directors. 5 experienced directors. No highly experienced directors. Independent Director Kim Campbell was the last director to join the board, commencing their role in 2019. The company’s insufficient board refreshment is considered a risk according to the Simply Wall St Risk Model.

Price target increased to NZ$0.90

Up from NZ$0.84, the current price target is provided by 1 analyst. New target price is 38% above last closing price of NZ$0.65. Stock is down 7.1% over the past year. The company is forecast to post earnings per share of NZ$0.032 for next year compared to NZ$0.0048 last year.

Anchorage Capital Partners entered into a conditional sale agreement to acquire Lollipops Educare Holdings Limited from Evolve Education Group Limited (NZSE:EVO) for an enterprise value of NZD 46 million.

Anchorage Capital Partners entered into a conditional sale agreement to acquire Lollipops Educare Holdings Limited from Evolve Education Group Limited (NZSE:EVO) for an enterprise value of NZD 46 million.

Anchorage Capital Partners entered into a conditional sale agreement to acquire Lollipops Educare Holdings Limited from Evolve Education Group Limited (NZSE:EVO) for an enterprise value of NZD 46 million on August 30, 2022. The enterprise value of NZD 46 million, less net debt (inclusive of a capex adjustment of NZD 2.5 million), is subject to adjustment post completion and also represents a multiple of over 13x FY21 New Zealand underlying EBITDA. The SPA may be terminated if a material adverse event occurs prior to completion that is reasonably likely to have a materially adverse impact on the reputation of LECL or its business as a whole. Evolve will pay break up fee of NZD 700,000 in case of termination. Prior to completion, all of Evolve's New Zealand based centre staff (other than the CFO and those based at the excluded centre) will be offered employment with LECL. Lollipops Educare Holdings had revenue of NZD 113.9 million and EBITDA of NZD 9.8 million, for year ended December 31, 2021. The transaction is conditional on approval of Evolve’s shareholders, completion of the necessary internal restructure to ensure all center based assets being acquired are held by LECL and the parties not receiving any written communication prior to completion from the Ministry of Education that indicates that the Ministry of Education could reasonably be expected to take any materially adverse action in relation to LECL’s Early Childhood Education licenses in response to the transaction. Evolve’s Board unanimously recommended the transaction. Completion of the transaction is currently targeted for September 30, 2022. The transaction will enable Evolve to redeploy proceeds to acquire assets in Australia, thereby accelerating its Australian growth strategy. To date Evolve’s legal and other advisory expenses have amounted to NZD 300,000.