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Last Wednesday Aveo announced its Board of Directors had unanimously accepted the offer of $1.27 billion for the 100% purchase of the company by the Canadian investment fund Brookfield, which is the largest property group in the world. The agreed price is $2.195 per security. What they get is 96 communities with approximately 10,000 homes, 200 aged care beds and a pipeline of 5,000 village homesites and 670 aged care beds, for $1.29B.
The 131 page announcement released to the stock exchange outlined a timetable through to November with Aveo preparing documents to send to the security holders who hold 580,737,672 securities. It will be recommending they sell to Brookfield, and at the same time Aveo will not seek out alternative bids. The Brookfield offer is not conditional on finance or further due diligence.
Tony Randello, CEO of the nation''''''''''''''''''''''''''''''''s largest retirement village provider, said the impending sale of its 16 retirement villages in South Australia and Tasmania "aligns with Aveo’s regular strategic review of opportunities across its portfolio".
The decision will make Aveo, which is owned by Brookfield Asset Management, a solely East Coast village operator. The sale would also see Keyton take its crown as the largest retirement village operator in Australia.
The 10-storey third stage of Aveo’s Parkside Carindale, a master planned vertical retirement community, located 14km east of Brisbane’s CBD, is finished with more than 50% of Vista''''s 100 one-, two- and three-bedroom apartments sold. Several buyers have come off a wait list after missing out on the sold-out first two stages, Parkland and Sanctuary buildings, built in 2019 that provided 97 apartments and the community’s lifestyle-driven amenities.
The $68 million Vista building is the latest stage in a major redevelopment that is transforming the original 38-year-old village of 107 low-set villas into a modern multi-storey community. When the six-stage $280 million community is complete, Parkside Carindale will provide 405 apartments and a planned co-located, privately owned 140-bed residential care facility.
The capitulation by the class action lawyers Levitt Robinson in its six-year bid to score a speculated $100 million-plus from village operator Aveo Group, claiming dodgy contracts and deals with residents, saved the retirement village sector months and months of shockingly bad media coverage over claimed rip-off contracts.
A class action win could have resulted in more class actions, a winding back of contract options available to residents of retirement villages and ramifications for the price exiting residents could sell at, not to mention the continued undermining of trust in the sector and impact on residents and the village workforce.