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Intueri may face sanctions in Australia

NZ Newswire logoNZ Newswire 23/09/2016 Sophie Boot

Intueri Education Group is in a trading halt on the NZX and ASX pending an announcement from the company over "possible sanctions" across the Tasman.

The upcoming announcement concerns "notification received from the Australian Skills Quality Authority (ASQA) relating to possible sanctions," Intueri said in a statement.

The shares will stay halted until either the company makes an announcement, or Sept. 27, whichever is earlier, unless ASX decides otherwise.

ASQA is Australia's national regulator for that country's vocational education and training sector, and regulates courses and training providers to ensure nationally approved quality standards are met.

Intueri operates across the Tasman through its Online Courses Australia subsidiary, which accounted for 35 of its $50.1 million of revenue in the six months to June 30 this year.

A large number of students in Intueri's Australian online courses are funded through VET Fee-Help.

The Australian government has imposed a cap on the scheme this year, holding all providers to their 2015 revenue levels.

The Australian Federal Department of Education and Training is conducting a review of the scheme after a Senate inquiry found rampant abuse of the system and soaring costs, and legislation is expected to be introduced early next year.

The possibility of an Australian sanction adds to the list of setbacks Intueri has faced since listing in 2014, including New Zealand probes into student enrolments, a student death at its dive school, the sudden exit of its chief executive, and more recently amending its lending covenants that were at risk of being breached.

The shares last traded at 30 cents on the NZX and have fallen 58 this year, making them the third-biggest decliner on the S&P/NZX All Index behind Wynyard Group and Bethunes Investments. Intueri listed at $2.35 in May 2014 and peaked at $3.35 in September 2014.

The company has missed prospectus forecasts and has been investigated by the Serious Fraud Office and its Quantum Education Group and Dive School units have been reviewed by the Tertiary Education Commission.

It suspended dividends in February pending the TEC review and is focusing on repaying debt as a result of the new lending covenant.

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