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Intueri to quit Australia

NZ Newswire logoNZ Newswire 2/02/2017 Paul McBeth

Intueri Education Group will quit Australia by the end of the year after losing federal government subsidies and is considering bids for some of its assets, saying it was probably in breach of its banking covenants in 2016.

The Auckland-based private education provider is undertaking a strategic review of operations in both Australia and New Zealand and is considering approaches from "a number of interested parties", it said in a statement.

Its Australian subsidiary, Conwal & Associates, won't reapply for the Australian Department of Education and Training's VET Fee-Help scheme to pay some or all of a student's fees, and Intueri will quit Australia altogether by the end of the year, seeking a buyer for its business across the Tasman, which is forecast to break even.

Intueri sold its Dive School, subject to conditions, which is expected to settle next month, and said a New Zealand Tertiary Education Commission investigation into its Quantum unit, which also attracted a review by the Serious Fraud Office, will be reported on shortly.

It reaffirmed its expectation that the company was in breach of its banking covenants and said it's still working with its lender, ANZ.

"Whilst there are opportunities to build our business operations without access to government VET funding, Intueri's current financial position does not allow us to put this medium term investment in place, and hence we are reviewing options to divest or close our Australian operations," chairman Chris Kelly said. "

We remain in close dialogue with our banking partner and expect to make significant progress assessing capital restructuring and strategic options over the next two to three months."

The education provider raised about $60 million in an initial public offering in 2014 to fund the acquisition of the Quantum group and become the country's biggest private training organisation, selling shares at $2.35 apiece and valuing the company at $252.5m, but has slumped to just 3 cents, or $3m.

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