Koala Disability Care business sold as FCG progresses relisting strategy
Freedom Care Group Holdings Limited (ASX: FCG) has advised that Koala Disability Care Pty Ltd, an entity in which FCG’s wholly owned subsidiary Freedom Care Corporation Pty Ltd (FCC) holds a 29% interest, has entered into a contract to sell its disability care and registered NDIS provider business conducted from Tuggerah in NSW to Ello Care Pty Ltd. Separately, the company continues to explore all viable pathways to facilitate a relisting on the ASX.
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Key deal terms at a glance
The sale involves the following key terms:
- Purchaser: Ello Care Pty Ltd (ACN 643 627 016)
- Sale price: $2,238,229 (exclusive of GST)
- Deposit: $223,822 (10% of the sale price), paid on exchange and held in trust
- Balance payable on settlement: $2,014,406, payable in cleared funds
- Settlement date: 14 October 2026, unless otherwise agreed in writing
- Retention arrangement: 20% of the sale price held in the vendor’s solicitor’s trust account for two months following settlement, subject to release adjustments tied to the number of NDIS clients who transition to the purchaser by the relevant adjustment date
FCG understands that Koala’s sole asset following the sale will be the proceeds of the business sale. FCC will continue to hold its 29% shareholding interest in Koala after the transaction completes. Upon completion, FCG will receive its proportionate share of the sale proceeds along with any other distributions it is entitled to.
Understanding the NDIS and why client transition numbers matter
The National Disability Insurance Scheme (NDIS) is a Australian Government-funded programme that provides financial support to Australians living with permanent and significant disability. It enables participants to access a range of services and supports tailored to their individual needs.
To deliver funded services under the NDIS, an organisation must hold registration as a registered NDIS provider. This credentialing demonstrates that the provider meets government quality and safety standards, and it allows the organisation to claim funding directly through the scheme.
In a business sale of this nature, the number of NDIS clients who successfully transfer to the new provider directly affects the commercial value delivered to both parties. The retention clause in this transaction reflects that: 20% of the sale price is held in trust post-settlement, with the final amount released subject to adjustment based on how many clients transition to Ello Care by the relevant adjustment date. This structure is common in care business transactions, protecting the purchaser if fewer clients transfer than anticipated while giving the vendor an incentive to support a smooth handover.
What this means for FCG investors
There are two key takeaways for FCG investors from this transaction. First, FCG will receive its proportionate share of the proceeds from the sale, representing a financial return on FCC’s 29% stake in Koala. Second, the divestment removes an operational asset from the group’s structure, with management confirming the company continues to explore all viable pathways to facilitate a relisting. No timeline for a relisting has been indicated in the announcement.
The near-term milestone for investors to watch is the settlement date of 14 October 2026, at which point the balance of the sale proceeds becomes payable, subject to the terms agreed between the parties.
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