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Oceania shares near bottom of IPO range

NZ Newswire logoNZ Newswire 12/04/2017 Paul McBeth

Oceania Healthcare will raise $200 million in an initial public offering after a bookbuild process priced the offer near the bottom of the indicative range.

The Auckland-based aged-care operator will sell 253.2 million shares, representing about 41.5 per cent of the stock, at 79 cents apiece after setting the price and allocations in a bookbuild this week, the company said in a statement.

Oceania had planned to sell between 192.3 million and 263.2 million shares, indicating a price of between 76 cents and $1.04 apiece, raising at least $200 million.

Of that, $173.4 million was earmarked to reduce debt, giving the firm headroom to fund development projects, $16.1 million would be used to acquire the title of Oceania's Elderslea facility currently under lease, and the remaining $10.5 million would cover the offer costs.

"The bookbuild has been oversubscribed with strong demand from New Zealand, Australian and international investors," chief executive Earl Gasparich said.

"Price and volume leadership were considered in the allocation process, enabling Oceania to establish a high-quality register of domestic and international investors."

Oceania is indirectly owned by Macquarie Group through Macquarie Infrastructure & Real Assets, which is not selling any shares into the offer.

The offer opens Thursday with the broker offer closing on April 28 and the priority offer to selected people closing on April 21. Oceania will list on the NZX and ASX on May 5.

The price values Oceania at $482.1 million, including net debt of $103.2 million, making it the 46th biggest company on the S&P/NZX All Index.

The company runs 48 facilities in New Zealand, with 3950 care beds, suites and units.

It has 1674 new residences in the pipeline with about 1000 consented or under construction, mainly at its Lady Allum rest home site on Auckland's North Shore, as well as in Tauranga, Hamilton, Nelson and Christchurch.

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