Metlifecare Ltd issued a statement on Monday clarifying its takeover status in light of “recent stock market volatility & some speculative commentary about its scheme implementation agreement with Asia Pacific Village Group Ltd”, the entity intended to buy the NZX-listed retirement village company for an international fund manager.
Asia Pacific Village Group’s owner is an entity owned by EQT Infrastructure IV Fund & managed by Swedish private equity investment fund EQT Fund Management Sarl.
Metlifecare’s share price tumbled from $6.69 at the close last Thursday to $5.90 on Friday, regained 20c on Monday then fell to $5.45 at the close yesterday.
Metlifecare chair Kim Ellis confirmed that the scheme implementation agreement “contains limited termination events and does not include any market fall or force majeure termination event.
“The scheme implementation agreement ‘material adverse change’ termination event definition has high financial materiality thresholds and excludes events resulting from changes in general economic conditions, the publicly traded securities market in general or law, as long as such general impacts do not have a materially disproportionate effect on Metlifecare & its subsidiaries.
“Contrary to a recent broker commentary, Asia Pacific Village Group is not entitled to elect to cancel the scheme implementation agreement at its option & pay a reverse break fee. The reverse break fee is only payable if Asia Pacific Village Group is in material breach of, and Metlifecare terminates, the scheme implementation agreement.”
Mr Ellis said Asia Pacific Village Group had continued to work co-operatively with Metlifecare to finalise arrangements for the meeting of shareholders to approve the scheme, scheduled for 29 April. He also understood Asia Pacific Village Group’s application for approval under the Overseas Investment Act remained on track to be determined before that meeting.
“Metlifecare therefore has no reason to believe that the conditions of the scheme implementation agreement will not be satisfied to enable the scheme to be implemented in late May.”
26 February 2020: Metlifecare performance modestly “solid” as it heads towards takeover
12 February 2020: Metlifecare sets Swedish takeover timetable
20 December 2019: Metlifecare attracts more takeover interest as board puts value well above first offer
26 November 2019: Metlifecare appoints offer advisor, sees share price rise 20% in 3 weeks
20 November 2019: Metlifecare gets buyout offer, suspends share buyback
Attribution: Company release.