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Retirement village firm Arvida seeks $42m

NZN 19/09/2016 Paul McBeth

Arvida Group plans to raise $41.8 million selling shares to help fund the acquisition of three new retirement villages in Tauranga and Waikato.

The Auckland-based retirement village operator will sell shares at $1.05 apiece in a one-for-seven renounceable rights issue to help fund a $66m purchase of two villages in Tauranga and one in Cambridge, it said.

That's a 12 per cent discount discount to the $1.19 price the shares last traded at.

The villages are expected to add an additional $4.4m of underlying profit to Arvida's earnings, a 28 per cent boost to its 2016 result which was better than the company forecast when listing in December 2014.

"These acquisitions are on strategy and provide us with a presence in two key New Zealand regions experiencing high growth in aged care and retirement living," chairman Peter Wilson said.

"We continue to actively consider opportunities that meet our strict criteria in terms of location, quality of assets and current management, potential for development earnings accretion."

Arvida was created through the merger of 17 retirement villages and aged care facilities and has added to that with several acquisitions since listing.

The latest purchases will increase Arvida's portfolio to 25 villages with 1,384 care beds and 1,248 units, and adds $11m of land available for brownfields development.

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