Parents still clueless on playgroup's status, await notice

With Tree House playgroup and nursery centres either shutting down or on the verge of closure, anxious parents have been wondering where to shift their toddlers in the middle of the academic year. Employees and staff at the playschools, who have been facing issues with their salaries not being paid on time, have now questioned why they are getting the short end of the stick when around 15 Tree House High Schools seem to be thriving.

With maids, aayas, teachers and other employees at the playschools having faced trouble with payment of their salaries, some questioned how Tree House Education & Accessories Ltd could be facing a financial crisis despite Rs 700 crore raised by founder and promoter Rajesh Bhatia over the last five to six years from the share market, investors and banks. Analysis of the company's balance sheet reveals that a loan of Rs 225 crore was extended to the Tree House High School, run by allegedly family controlled Mira Education Trust.

Doubts have also been raised on whether Tree House adhered to the Minimum Wages Act, as some of its employees allegedly received their salaries in cash. A Tree House teacher, on condition of anonymity, said, "Teachers get their salary in their bank accounts, but the maids and aayas salaries are sent in cash in envelopes from a centre head to our centres." Uday Salian, a parent whose child was enrolled at the recently shut Charkop Tree House playschool and nursery, said, "Officials at this Tree House playgroup claim that though the promoter has issued statements in newspapers that he will soon clear the salaries of staff and continue with the playgroup and nurseries, they haven't received any mail from the higher authorities till now. This nursery will remain closed till further intimation. We asked whether the Tree House playgroup staff were facing problems, they claimed they were being paid their salaries smoothly."

Despite attempts, Rajesh Bhatia could not be reached for a comment. Meanwhile, Zee Learn Ltd (ZLL) on Friday announced its withdrawal from the proposed merger with Tree House Education and Accessories Ltd (Tree House). ZLL Board announced that in light of the recent inordinate developments at Tree House, it was withdrawing from the proposed merger process which had been awaiting various court, shareholder and related statutory approvals.

ZLL Board in its meeting held on Friday took cognizance of the recent adverse media reports of Tree House closing down hundreds of its playgroup centres abruptly leaving parents and students high and dry, and of many parents filing police complaints against Tree House and its Promoters. "The Board feels that this may change the complete business dynamics of Tree House and is not in the spirit of the Scheme of Amalgamation signed between ZLL and Tree House. This fact coupled with the steadily deteriorating financials of Tree House, allegations of irregularities by Tree House, its Promoters and the need to protect the interest of ZLL shareholders, led to the Board of ZLL to unanimously agree to withdraw from the merger process with Tree House," a statement from ZLL read.

"The Board approved sending requisite communication to Tree House to this effect and also convey to them that ZLL reserves its rights to initiate further suitable action against Tree House/its Promoters for ZLL's loss of reputation/goodwill and damages," it added.

"ZLL, a company promoted by Essel group, which runs Asia's largest play school chain (Kidzee) with 1600 plus centres had agreed some time back to participate in this merger process with Tree House with great hopes of serving an even larger network of students. Recently, inspite of the reported worsening financial situation at Tree House, ZLL had agreed to keep the merger alive at renegotiated terms," the statement said.

It added, "However, the current media reports of Tree House/its Promoters closing down a huge number of centres mid-session without even a thought for the helpless students, parents has left everyone at ZLL aghast as this sort of an action is completely against the moral and professional values of ZLL. Mr Debshankar Mukhopadhyay, CEO of ZLL said "ZLL has already requested its Kidzee franchises to try and provide proper mid-term admissions to ex Tree House students who are stuck and wish to seek help because of the actions of Tree House/its Promoters. I am sure that our Franchises will help to whatever extent possible. We hope that other play school chains will also come forward to help the students in this time of their need."