$1.3 billion buyout offer for senior care company Arvida

A US private equity firm has made a $1.3 billion takeover bid for retirement and aged care home company Arvida.

Stonepeak’s offer of $1.70 per share represented a 65% premium to Arvida’s closing price on Friday and was similar to a mystery offer that was rejected last September as inadequate.

Arvida operates six retirement homes in Christchurch, including self-catering villas, care suites and serviced apartments.

Arvida’s board of directors and the selected shareholders it had consulted were in favour of the offer and recommended its acceptance.

Anthony Beverley, Arvida’s chairman, said the company had been looking at how to maximise further value for shareholders.

“During this process, it became clear that Stonepeak’s proposal was superior to other options that the Board considered were realistically available to the Company and enabled shareholders to realise 100% of their investment at a significant premium to the current share price.

“We believe this program is the best way to accelerate the transaction and the recognition of shareholder value. It provides both a defined timetable and an agreed price that all shareholders will receive.”

The acquisition would be made under a plan of arrangement that requires the approval of 75% of voting shareholders and 50% of all shares of the company in favor of the transaction.

An independent report on the offer must be prepared.

“Based on the recent feedback the board has received from institutional and retail investors, including since the announcement of the Value Recognition Program, we are very confident in shareholder support for the program,” Beverley said.

Arvida has 35 villages across New Zealand, but has slowed its development work due to high interest rates and debt levels.