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Speaker 1: Jeremy Hasson of Milford Acid Managements with us a Jeremy Evening, Heather,

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Speaker 1: And it's been a busy start to the week on

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Speaker 1: the NZX with those takeover offers. We've got the warehouse

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Speaker 1: and we've got our Vida and play talk me through it.

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Speaker 2: Yeah, we had the warehouse yesterday, which our listeners you know,

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Speaker 2: definitely would have seen in the press. But also local

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Speaker 2: retirement village operator our Vita got a significant bid two

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Speaker 2: on Monday, and that bid came from a large infrastructure

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Speaker 2: slash private equity investor called Stone Peak, and the offer

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Speaker 2: was at a significant premium sixty five percent higher than

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Speaker 2: the Friday closed price, which you know, some investors will

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Speaker 2: be pretty happy about, but it is still down from

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Speaker 2: the stocks peak in mid twenty twenty one, you know,

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Speaker 2: when the price was around two dollars ten, So some

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Speaker 2: investors might be a little bit disappointed the price couldn't

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Speaker 2: get back or wasn't given the chance to get back

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Speaker 2: to this level. But it is highly likely that this

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Speaker 2: deal at a dollar seventy goes through. You know, there

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Speaker 2: were limited conditions. You know, diligence and financing is complete

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Speaker 2: and there's just the OAO and if you hold a

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Speaker 2: vote to occur. So the company is expecting our completion

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Speaker 2: in two four of this year.

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Speaker 1: So what is it that these global private equity players

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Speaker 1: are seeing in the retirement sector that they think is

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Speaker 1: so attractive.

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Speaker 2: Yeah, interestingly, now, this is the second takeover offer of

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Speaker 2: a listed retirement player, following the MetLife Care deal in

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Speaker 2: twenty twenty, which was brought by another global private equity

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Speaker 2: fund called EQT Capital. And we all know about the

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Speaker 2: demographic wave, the aging population that's coming through New Zealand,

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Speaker 2: and retirement villages are pretty well established products now, they're

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Speaker 2: well known, but the penetration still has room increase. So

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Speaker 2: you know, that gives quite a bit of growth in

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Speaker 2: the sector in these companies which private equity does really

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Speaker 2: tend to like. And arguably, you know, it's a good

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Speaker 2: time to buy as well. Valuations are attractive. The sector

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Speaker 2: has been very depressed for the past few years with

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Speaker 2: the slow housing market, so it's clear that some overseas

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Speaker 2: investors are looking at New Zealand, they're seeing opportunities and

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Speaker 2: perhaps they're calling the bottom even in seeing a good

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Speaker 2: pathway up from here.

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Speaker 1: Yeah, I mean, as a result of this obviously we've

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Speaker 1: had some positive price reactions and the other retirement names

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Speaker 1: as well. Do you reckon that's going to continue?

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Speaker 2: Yeah, it's hard to isolate solely if this is due

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Speaker 2: to takeover offer. You know, some of the more under

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Speaker 2: pressures sectors on the inxet X, like retail, construction, retirement.

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Speaker 2: You know, they've all rallied very strongly posts the RBNZ

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Speaker 2: of a statement two weeks ago, but this takeover news

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Speaker 2: is likely given the list of pairs retirement pairs another

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Speaker 2: leg up and Oceania, which is the smallest retirement name,

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Speaker 2: is up a whopping forty seven percent so far this month,

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Speaker 2: and the larger pairs Rhyman and Somerset It both lot

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Speaker 2: pretty sharply as well. But I think this is an

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Speaker 2: example again of the market moving share prices ahead of

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Speaker 2: financial results. I think the results for the sector will

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Speaker 2: be still pretty depressed for the next six to twelve months,

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Speaker 2: but the sector does have a strong link to house

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Speaker 2: prices and health sentiment and activity, so the potential interest

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Speaker 2: rate cups will help eventually. So it feels like a

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Speaker 2: little bit of a relief rally for now. But the

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Speaker 2: takeover interest has shown the market that valuations had fallen

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Speaker 2: a bit too much perhaps, and there are some good

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Speaker 2: deals out.

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Speaker 1: There, good stuff. Hey, Jeremy, thanks for talking us, Sir

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Speaker 1: Jeremy Houston of Milford Asset Management. For more from Hither

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Speaker 1: Duplessy Allen Drive, listen live to news talks. It'd be

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