Cluey Ltd (ASX: CLU) Announces Art of Smart Acquisition and $4.5 Million Capital Raising
In a recent ASX announcement, Cluey Ltd (ASX: CLU) has confirmed the acquisition of Education Futures Group, the holding company for the Art of Smart group. The Cluey Art of Smart acquisition is valued at up to $6.5 million and marks a strategic move for Australia’s largest online tutoring company. This investment positions the education technology provider to meet growing demand across both digital and physical tutoring markets through a hybrid learning model.
Trading at $0.078 per share with approximately 352.8 million shares on issue, Cluey’s strategic move signals a shift from pure-play online tutoring into a comprehensive education services provider. The acquisition targets Art of Smart’s three NSW campus locations, focusing on senior secondary students through online and in-person tutoring. This expansion addresses the evolving preferences of students who demand flexible learning options.
What are the terms of the Cluey Art of Smart acquisition?
The Cluey Art of Smart acquisition is structured with a maximum consideration of $6.5 million, arranged through a two-tranche payment mechanism based on financial performance. This pricing arrangement reflects valuations in the education technology sector for businesses showing consistent profitability.
The tranche 1 completion payment is calculated using a multiple of 6.5 times FY25 normalised EBITDA of the Art of Smart group, subject to standard working capital and cash completion adjustments. The majority of this payment will be in cash, with 3.75% satisfied through the issue of Cluey shares to the majority vendor, controlled by Rowan Kunz.
The tranche 2 earnout payment provides additional upside based on future performance, calculated as 6.5 times the increase in FY27 EBITDA from the FY25 normalised EBITDA baseline. Furthermore, the FY27 EBITDA will be reduced by any shortfall if FY26 EBITDA falls below the FY25 normalised figure, ensuring accountability.
Key Transaction Terms:
- Completion payment: Based on 6.5x FY25 normalised EBITDA
- Earnout payment: Based on 6.5x increase in FY27 EBITDA from the FY25 baseline
- Tranche 1 Vendor Shares: 3.75% paid in Cluey shares
- Tranche 2 Vendor Shares: 37.5% paid in Cluey shares
- Escrow Period: 24 months for tranche 1 shares, 12 months for tranche 2 shares
As part of the deal, Rowan Kunz will continue as Managing Director of the Art of Smart group, ensuring operational continuity and experienced leadership. His executive employment service agreement with Cluey Learning Pty Ltd is a key condition for the completion of the acquisition.
How is Cluey funding the Art of Smart acquisition?
The transaction will be funded primarily through a fully underwritten $4.5 million entitlement offer. This investor update provides further details on the associated capital raising and the use of proceeds.
Following the completion of the offer and acquisition, Cluey will maintain approximately $6.8 million in pro forma net cash, based on 30 June 2025 accounts. This capital provides sufficient working capital for integration, growth initiatives, and ongoing operational requirements.
Proceeds from the entitlement offer will be allocated to the tranche 1 cash payment for the acquisition, transaction and integration costs, and growth capital to support expansion, including the potential rollout of new Art of Smart campuses. The company has stated that if the acquisition does not proceed, it reserves the right to withdraw the entitlement offer.
What does the Cluey entitlement offer mean for shareholders?
The 2-for-11 non-renounceable entitlement offer allows existing shareholders to subscribe for 2 new shares for every 11 existing shares held on the record date, 20 November 2025.
| Entitlement Offer Details | Specification |
|---|---|
| Offer Ratio | 2 new shares for every 11 held |
| Issue Price | $0.07 per share |
| Discount to Last Trade | 10.3% |
| Discount to 30-day VWAP | 11.8% |
| Total Raising | $4.5 million (before costs) |
| Record Date | 20 November 2025 |
| Closing Date | 10 December 2025 |
The issue price of $0.07 per share represents a 10.3% discount to the last traded price and an 11.8% discount to the 30-day volume-weighted average price (VWAP) as of 5 November 2025.
Key Timeline Events:
- Ex-Date: Wednesday, 19 November 2025
- Record Date: Thursday, 20 November 2025 at 7pm
- Offer Opens: Monday, 24 November 2025 at 9am
- Offer Closes: Wednesday, 10 December 2025 at 5pm
- Results Announced: Friday, 12 December 2025
- New Shares Issued: Tuesday, 16 December 2025
- Quotation Commences: Wednesday, 17 December 2025
The offer is fully underwritten by Gleneagle Securities (Aust) Pty Ltd. Chairman Robert Gavshon and Deputy Chairman Mark Rohald have confirmed their commitment to subscribe for their full entitlements, demonstrating board confidence in the transaction.
What are the strategic benefits of the Cluey Art of Smart acquisition?
The Cluey Art of Smart acquisition creates a comprehensive education ecosystem that combines digital scale with a physical presence. The strategic synergies are focused on customer acquisition, content development, and geographic expansion.
Art of Smart is expected to benefit from Cluey’s digital marketing capabilities, which could enable student acquisition at a reduced cost. In addition, Cluey’s proprietary demand data may be used to identify optimal locations for new Art of Smart campuses across Australia, facilitating a data-driven expansion strategy.
Operational Synergies:
- Access to Cluey’s digital marketing may reduce student acquisition costs.
- Proprietary data could inform the location of new campus rollouts.
- Art of Smart’s expertise in senior secondary tutoring can be leveraged across Cluey’s K-12 offerings.
- Combined platform capabilities may enhance both online and offline learning experiences.
- Shared curriculum development across online and offline channels is anticipated.
Art of Smart’s established expertise in serving senior secondary students will be leveraged across Cluey Learning’s broader capabilities. This integration could extend Art of Smart’s addressable market beyond its core segment, creating additional revenue opportunities for the combined business.
Want more ASX news?
Looking to stay ahead of major developments in ASX technology and education technology companies? Subscribe to StockWire X’s free Big News Blasts and join over 20,000 investors receiving instant email alerts on significant announcements in these sectors, each accompanied by detailed analysis. With a quality filter ensuring only major news events are distributed, subscribers gain access to the most important market-moving information without the noise. Join today to receive comprehensive insights delivered directly to your inbox at https://stockwirex.com/.