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Beleaguered childcare giant ABC Learning received about $400 million worth of taxpayer subsidies last year.
ABC's more than 1000 Australian centres remained open for business yesterday as the company discussed the sale of parts of its operations after the plunge in its share price this week.
The company's shares remained in a trading halt and the Australian Securities Exchange confirmed it would examine disclosure issues surrounding the sale of shares by four directors.
The availability of federal subsidies has helped the Eddy Groves-founded company grow into the dominant player in the Australian childcare industry.
Like other childcare providers, it receives revenue from childcare benefit fee subsidies and special childcare benefit, government job search, rehabilitation, trainee and after-school-care funding.
ABC Learning has written to parents to reassure them that its centres will continue to operate.
The company yesterday told parents no centre would be closed, except those closed in the short-term for renovation, and that the company would continue to deliver the same quality of service.
Prime Minister Kevin Rudd said the Federal Government was closely monitoring ABC Learning's position. "When it comes to child care, it's a big concern to every working family who have kids looked after by child care," Mr Rudd told ABC Radio.
"The Government, the relevant authorities are continuing to monitor closely developments regarding ABC Learning Centres."
Premier John Brumby said governments might have to intervene if the company collapsed.
"We would talk to the Federal Government about that and we would talk to local councils about that," he said.
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- reprinted from The Herald Sun