All Black Dan Carter increased his shareholding in newly listed Arvida

Thursday 18th December 2014

All Black Dan Carter said he increased his shareholdings in the retirement village sector when supporting the initial public offer of Arvida Group which debuted on the NZX this morning.

The stock rose 2 percent after Carter rang the bell to signal the stock’s debut on the exchange in a ceremony at the NZX head office in Auckland this morning. It has since dropped back to its offer price of 95 cents, which valued the new retirement village operator at $215 million.

The Christchurch based company has merged 17 retirement villages and aged care facilities in a roll up that chief executive Bill McDonald said could be extended to other retirement villages that have expressed interest once the existing merger is further bedded down.

Carter said he initially invested in several retirement villages on the advice of his business mentor, the late Grant Adamson, who was the original impetus behind Arvida. He unexpectedly died two weeks into the roll up process.

Other All Blacks, including Richie McCaw and Kieran Reid, also owned shares in one of the facilities involved in the Arvida merger, Christchurch’s Park Lane Retirement Village.

Carter said professional rugby players were lucky to get 10 years out of their careers so it was important to invest the money they made wisely as they went along.

When asked about his investment in the now liquidated Gas Clothing menswear chain, Carter said timing was an issue with that. “You learn from your mistakes and I felt I did that. It was not the best experience but I learned a lot from it.”

Creditors were owed $1.1 million when the chain went under and the final liquidators report said unsecured creditors owed around $26,000 were unlikely to recover their money.

Carter said when he eventually hangs up his boots he may look at investing in other areas of the sharemarket as well but for now he thought the retirement village sector had good potential for growth.

He couldn’t say how much his shareholding had increased to under the IPO and wasn’t willing to say how much money he had invested.

The IPO included a $5 million priority pool for existing residents, staff and investors to buy into the company. Existing shareholders hung onto about 63 percent of the business.

NZX chief executive Tim Bennett said Arvida was the 16th listing on the market this year. Some $2 billion of capital had been raised from the IPOs this year, of which $500 million had gone back into the companies for growth, he said.

Arvida used the funds to repay $70 million of debt, and $4.35 million will be used to pay offer costs. After the IPO, Arvida expects to have debt of some $7.8 million and it has a $40 million bank borrowing facility that would enable it to carry out planned brownfield developments and any new acquisitions.

McDonald said further acquisitions were likely along with brownfield developments in various stages of completion which will see another 200 to 250 care beds and units or $9 million worth added to the portfolio by 2016.

BusinessDesk.co.nz

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