In November 2008, ABC Learning, the world’s largest listed childcare provider, went into voluntary administration.
Founded by entrepreneur Eddy Groves and his wife Le Neve, ABC was part of a tide of corporate investment in childcare during the 1990s and 2000s. Deregulation allowed private companies to profit from government subsidised childcare places, and the soaring real estate value of licensed nursery premises made childcare a profitable prospect for private enterprise. By 2006 Groves was the richest man under 40 in Australia, and the financial press were full of admiring commentary.
And yet ABC’s business model was rotten from the start. It was the classic financialized firm: relying on heavy indebtedness, asset-price inflation and worker exploitation. When it finally crashed, the government bailed it out with AUD 56 million to protect tens of thousands of nursery places and 16,000 Australian jobs.
