Aveo may be working with preferred suitor on a deal
Aveo [ASX:AOG], an Australia-based retirement village business, may be working with a preferred suitor, The Australian reported. According to the report in the paper’s Dataroom column, speculation has emerged that the group is in talks to be purchased for between AUD 2.50 and AUD 2.70 per share.
The item noted that sources close to Blackstone, which was earlier thought to be interested in Aveo, said that the company is not preparing a bid. However, speculation continues that Blackstone remains interested in Aveo, it said.
The paper said that perhaps one reason for the conflicting messages is that Blackstone’s Arena Living, a New Zealand retirement villages owner, may be eyeing Aveo, rather than Blackstone itself. Blackstone purchased Arena Living in 2016, the item noted. The paper said that New Zealand retirement operations work under a different model than those in Australia and it is unclear if there would be major synergies between the portfolios.
The article also noted that Stockland [ASX:SGP] is searching for an investor for its retirement portfolio and there is speculation that buyers looking at those assets could also approach Lendlease [ASX:LLC] to see if it may be interested in selling its portfolio.
APG, a Dutch pension fund, purchased a 25% stake in Lendlease’s retirement portfolio in 2017 for AUD 425m (USD 300m), it said, adding that perhaps APG will also look to purchase Stockland’s assets. The paper said that Blackstone’s New Zealand operations could seek to buy Stockland assets as well as Aveo.
The item noted that JPMorgan and Credit Suisse are working on a deal for a potential buyer of Aveo, but it is unclear which parties they are advising.
The paper said that Malaysia-based Mulpha International [KLSE:MULPHA] owns 24.4% of Aveo and the company's future likely depends on the shareholder's intentions. The paper noted that a deal could involve Aveo being purchased in a 50/50 joint venture between Mulpha and a private equity firm.