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Eddy Groves ABC partner was in rich US childcare deal [AU]

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Author: 
Walsh, Liam
Publication Date: 
1 Jul 2009
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EXCERPTS

A business partner of Eddy Groves won a lucrative US childcare-centre development deal with ABC Learning Centres, according to court documents.

It was guaranteed to deliver him a $US20 million ($A24 million) yearly profit.

Under the deal, ABC Learning Centres, where Mr Groves was then chief executive, was to buy "50 childcare businesses" every year from a company owned by developer Ken Krynski.

The deal was first struck in 2006, according to defences filed by Mr Krynski and associated companies.

The defences form part of their counter to fraud allegations that ABC launched against Nevada-based Mr Krynski and the companies.

ABC's allegations involve a $35 million ABC loan, and transfers of properties.

Mr Krynski owned American Child Care Properties (ACCP).

Arizona-based RCS Capital late last year bought out ACCP. RCS itself had launched a lawsuit alleging ABC had defaulted on a separate $US100 million deal.

...

The Courier-Mail last year revealed Mr Groves had long been a partner in separate property businesses with Mr Krynksi.

Mr Groves said at the time ABC followed an assessment process to ensure only deals with ACCP which stacked up economically were accepted.

He also said his private business with Mr Krynski did not relate to any ABC work.

- reprinted from the Courier-Mail

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Entered Date: 
1 Jul 2009
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