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ABC Learning Centres has requested another day's suspension from trading with founder Eddy Groves in the company's US headquarters in Detroit, negotiating a possible sale of its US assets.
The two most likely bidders are US childcare giant Knowledge Universe Corp, which is backed by former junk bond king Mike Milken, and Bright Horizon Family Solutions, owned by Bain Capital, the third-largest US childcare operator.
An ABC spokeswoman said an announcement might be made in the next day or so, "but there is also a possibility that it may come to nothing".
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It said it was extending the current suspension of its shares by another day, with trading expected to resume tomorrow instead of today as announced last week.
In another development, listed litigation funder IMF Australia confirmed approaches from ABC shareholders about possible legal action.
ABC requested a voluntary suspension from trading last Thursday after a crisis of confidence among investors, saying it had received indications of interest for "part of" its business.
Mr Groves, who was forced to sell most of his holdings in ABC shares in recent weeks to meet margin calls and now owns only 2 per cent, arrived in Detroit at the weekend via Los Angeles.
It is unclear whether he has had discussions with the Los Angeles-based Mr Milken, who is a major shareholder in Mounte LLC, which owns Oregon-based Knowledge Learning Corp. Gold Coast-based Mr Groves is believed to have travelled from Los Angeles to Detroit by private jet.
The Detroit suburb of Novi is the headquarters of the Learning Care Group Inc (LCGI), a company bought by ABC in January 2006 for $US218 million - the start of Mr Groves' foray into the US childcare market. LCGI later bought Children's Courtyard for $US66 million and La Petite Academy for $US330 million, making the ABC-owned group the second largest childcare operator in the US after Knowledge Learning.
ABC's US arm now owns 1150 centres in the US in 39 states and looks after 167,000 children.
Its biggest markets are in Texas, California and Florida.
A merger of ABC's US business with Bright Horizons Family Solutions would create a substantial operator with almost 4 per cent of the highly fragmented US childcare market, coming in just behind Knowledge Learning.
- reprinted from The Australian