Announcement
TRANSACT: MET: New Scheme of Arrangement with EQT Infrastructure
04:29pm
MET
10/07/2020 16:29
TRANSACT
PRICE SENSITIVE
REL: 1629 HRS Metlifecare Limited
TRANSACT: MET: New Scheme of Arrangement with EQT Infrastructure
MEDIA RELEASE
10 JULY 2020
NEW SCHEME OF ARRANGEMENT WITH EQT INFRASTRUCTURE
Metlifecare Limited (NZX: MET, ASX: MEQ) has entered into a new Scheme
Implementation Agreement (SIA) under which Asia Pacific Village Group Limited
(APVG), an entity owned by EQT Infrastructure IV fund and managed by EQT Fund
Management S.a r.l., has agreed to acquire all Metlifecare's shares for
NZ$6.00 per share.
The parties have also agreed to discontinue all litigation and settle all
disputes related to the original SIA, with the parties to cover their own
costs in relation to the litigation.
The Board has canvassed Metlifecare investors and has received strong
investor support for the scheme, with a number of shareholders indicating
they prefer the alternative of a scheme at NZ$6.00 over the uncertainty of
prolonged litigation.
A minority of shareholders have indicated that the transaction price falls
below or at the lower end of their own valuation range.
Metlifecare has been advised that its largest shareholder, the Guardians of
the New Zealand Superannuation Fund (NZ Super), has entered a voting deed
with APVG under which it has agreed to vote its 19.9% interest in Metlifecare
in favour of the scheme, subject to certain terms and conditions.
The Metlifecare Board was unanimous in its view that the scheme should be put
to shareholders.
In a finely balanced decision, a majority of Metlifecare's six directors,
comprising Christopher Aiken, Mark Binns, Alistair Ryan and Rod Snodgrass,
recommend shareholders vote in favour of the scheme in the absence of a
superior proposal (as defined in the SIA) and each has undertaken to vote all
shares held or controlled by them in favour of the scheme.
In recommending approval of the scheme, the majority of directors believe
that, while this has been a difficult decision, the uncertainty and
disruption associated with litigation and the potential risks inherent in a
COVID-19 environment make the offer of NZ$6.00 per share - a 14.9% premium to
the last closing price before the 6 July 2020 announcement it had received a
new non-binding indicative offer from EQT - reasonable.
Metlifecare Chair Kim Ellis does not recommend shareholders vote in favour of
the revised scheme. Director Carolyn Steele has abstained from making a
recommendation given her association with NZ Super.
Mr Ellis feels strongly that shareholders should be given the opportunity to
vote on the scheme. However, he believes the scheme consideration under the
new SIA does not represent fair value and should be at least at the mid-point
of the range determined by independent adviser KordaMentha at NZ$6.35. He
notes that the indications of majority shareholder support for the scheme
reduced the prospect of negotiating a higher price.
The price is within the valuation range contained in KordaMentha's
independent adviser report, which was finalised on 5 June 2020. KordaMentha
assessed the value of Metlifecare shares in the range NZ$5.80 to NZ$6.90 per
share.
A new independent adviser's report prepared in accordance with guidance of
the Takeovers Panel will be required under the new SIA.
In accordance with the terms of the SIA with APVG, Metlifecare directors and
executives will contain any further comments on the transaction to the scheme
booklet, which will be sent to shareholders.
The transaction will be implemented by a scheme of arrangement, a
court-supervised process under which a meeting of shareholders will be held
to vote on the transaction.
Metlifecare shareholders do not need to take any action at this time. They
will be given the opportunity to vote on the scheme at a special meeting of
shareholders, currently expected to be held in late September 2020.
A scheme booklet with details of the special meeting and a copy of the new
independent adviser's report is expected to be sent to shareholders in early
September. Metlifecare expects to appoint an independent adviser shortly.
The scheme is subject to customary conditions including shareholder approval,
High Court approval, Overseas Investment Office consent and there being no
prescribed occurrence (as defined in the SIA). Unlike the original SIA, the
new SIA is not subject to a 'material adverse change' clause and the
transaction price does not have to fall within or above the independent
adviser's valuation range.
It is currently contemplated that the scheme will be implemented in late
October 2020.
A copy of the SIA accompanies this announcement.
Metlifecare is being advised by Jarden Partners Limited, Simmons Corporate
Finance Limited and Chapman Tripp.
This announcement is authorised for release to the market by the Board of
Metlifecare Limited.
Ends
For more information please contact:
Clive Mathieson
clive@catoandclive.com
Mobile: +61 411 888 425
About Metlifecare
Metlifecare is a leading New Zealand owner and operator of retirement
villages, providing rewarding lifestyles and outstanding care to more than
5,600 New Zealanders. Established in 1984, it currently owns and operates a
portfolio of 25 villages in areas with strong local economies, supportive
demographics and high median house prices, located predominantly in New
Zealand's upper North Island.
End CA:00356098 For:MET Type:TRANSACT Time:2020-07-10 16:29:19
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