What is the real cost of the Sterling acquisition for G8 Education (GEM)

What is the real cost of the Sterling acquisition for G8 Education (GEM)? Earlier this week G8 announced the acquisition of Sterling Early Education for a consideration of $228million. For many investors GEM has looked attractive due to its rapid growth and ability to successfully reinvest earnings. Equally, however, the failure of ABC Learning is still fresh in investors minds. GEM have been very deliberate communicating their discipline when it comes to acquisitions, saying they would not pay more than 4x EBIT for new centres. The latest transaction has been done at nearly 5.8x EBIT - raising a number of eyebrows in the investment community. So whilst the transaction value is $228million it is hard to quantify what the real cost to management will be. I spoke with Justin Braitling from Watermark Funds yesterday and he gave me a very candid response on the matter.