Oceania investigates capital raising

TIM HUNTER
Last updated 18:08 23/07/2014

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Retirement village company Oceania Group has confirmed a possible capital raising after Fairfax published speculation that it could float on the NZX.

In a statement, Oceania said it had hired First NZ Capital, Deutsche Craigs and Macquarie to advise on options to speed up development.

"But we do not anticipate confirming our preferred capital raising option until the fourth quarter of this year," it said.

On Tuesday Fairfax said market sources were indicating Oceania could raise $200 million to $300m in an initial public offering this year. The company was making earnings before interest, tax, depreciation and amortisation of $30m-$35m, it said.

Oceania has more than 3800 residents with 50 retirement villages and care facilities in New Zealand. It provides a full range of independent living, rest home, hospital and dementia care services. 

In the statement, Oceania said it wanted to accelerate its development pipeline at premium locations in Auckland, Christchurch, Nelson and Tauranga.

New chief executive Earl Gasparich will join the company in mid-August to replace Guy Eady who left in June. 

Oceania is owned by Australian investment firm Macquarie. According to the most recent financial statements filed to the Companies Office, Oceania had positive cashflows from operating activities of $52.8m for the year to May 31, 2013.

But this was boosted by a one-off $31m insurance payment covering Christchurch earthquake damage.

The company reported a loss of $35.5m, mostly accounted for by a $42m goodwill impairment.

Oceania had net liabilities of $132.9m, but notes to the accounts said this included $267.2m in shareholder loans from Macquarie. The notes also show Oceania was carrying $274m in bank loans.

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