OCA - Oceania Group - retirement villages

[winner69]

Will get national MP to leak out the data eh....

Better to get Twyford to leak it ....it be a big % ...like 185%

[Maverick]

We've had a few results and comments come through now from other operaters to get a better feel for the Covid costs/impediments. Summerset's release yeatserday was the fullest so far and it was surprisingly good IMO.
One can assume OCAs expenses will be relatively higher than SUMs ( SUM being more villa focused....less PPE needed). I posted on that thread if any body isn't interested.

After going through their numbers I think there is very likely plenty of upside surprise for OCA in a few weeks time.

Its pretty likely I'll be selling a vehicle today so it's straight to OCA with those funds for a cheeky20% gain over the next month.

[RTM]

We've had a few results and comments come through now from other operaters to get a better feel for the Covid costs/impediments. Summerset's release yeatserday was the fullest so far and it was surprisingly good IMO.
One can assume OCAs expenses will be relatively higher than SUMs ( SUM being more villa focused....less PPE needed). I posted on that thread if any body isn't interested.

After going through their numbers I think there is very likely plenty of upside surprise for OCA in a few weeks time.

Its pretty likely I'll be selling a vehicle today so it's straight to OCA with those funds for a cheeky20% gain over the next month.

Be better if you popped down to Turners and replaced it Maverick.
Thanks for sharing your analysis and comments on the retirement villages. Appreciated .

[thegreatestben]

I snagged some more yesterday and the small amount at 94c this morning, looks like many are anticipating MET news!

[Beat the Bank]

It would be interesting to know what percentage of returning Kiwis are buying houses, and what percentage are returning so that they can claim benefits and other government support.

Remember that those coming "home" will need housing whether they are buying or renting. Both property investors and owners keep up property demand, and therefore help the retirement villages to sell new units.

[Waltzing]

If MAV is on the money than its time for him to disclose his real occupation in the retirement sector as having deep insider knowledge. His one star on the shoulder will surely have to have some more added to it?

[winner69]

If MAV is on the money than its time for him to disclose his real occupation in the retirement sector as having deep insider knowledge. His one star on the shoulder will surely have to have some more added to it?

I should leave it for MAV to respond but Mav is no insider - he'll probably tell us he's just a dedicated investor who has deeply researched Oceania and makes sure he keeps on top of things as things unfold - both sector and company wise. Mav has often told us of his site visits and discussions with anybody who'll talk to him.

We should be blessed he shares his thoughts.

[Waltzing]

Thank you winner we are blessed indeed. HSBC consider RBNZ the central bank of kitchen sinks. It appears there is a view that NZ is on track for a V recovery. Not sure the locals thinks so. If so and then prehaps MAV's is on the money in the mid term and onwards.

[Maverick]

I should leave it for MAV to respond but Mav is no insider - he'll probably tell us he's just a dedicated investor who has deeply researched Oceania and makes sure he keeps on top of things as things unfold - both sector and company wise. Mav has often told us of his site visits and discussions with anybody who'll talk to him.

We should be blessed he shares his thoughts.

That is very kind of you to say Winner, we are lucky to have your thoughts too!
This post is off topic but worth a little diversion .

Waltz...I am just another investor with no inside knowledge , I've just done a sh*t load of specific work over a few years which has built up.

To further answer your question, I post for 2 reasons,
Firstly, it is a great way of quantifying and congealing my own thoughts knowing minds far greater than my own will hold me to account if I`m wrong or crazy.
Secondly and mostly , it is out of deep respect for posters such as Winner, Beagle, Baabaa, Couta,Peat, black Peter ... etc etc (and many of the old timers here who don`t post prolifically but are definitely worth reading when they do). These posters offer their own insights/expertise on other sectors and companies of which I`m ignorant.
They have all helped me make $ in the past so I feel it is only fair to "pay back" if I have something of value to contribute.

These posters who freely give their time and valuable opinions collectively make up this website that any "Jo public" can peruse. Its a unique situation where absolutely anyone has free access to pick and choose from to suit their own investing styles.

Back to on-topic,
Bring on the OCA result...very confident now after SUM`s announcement yesterday that Beagle will be buying me the beer.

[dubya]

From todays Herald:

Swedes could go further than Metlife
Bupa is seen ripe for the picking, and Oceania Health also a possible target

The New Zealand Herald10 Jul 2020

Metlifecare’s on-then-offthen-on-again takeover by Swedish predator EQT has raised talk in the sector of further M&A activity involving the same business.

Once Metlife is hoovered up at the newly-lowered $6 a share, the Swedes could go even further, perhaps eyeing NZX-listed Oceania Healthcare and the unlisted Bupa NZ’s care home assets. Nothing has been said in public about this, but if that went ahead it could be a $2 billion-plus deal.

The Commerce Commission would be unlikely to look askance at the Swedes, the speculation has it, due to assets being widely held and a deep and evolving market with many operators housing the 43,000 Kiwis in retirement residences.

But due diligence might be tricky due to Covid-19.

The Swedes have around $50b under management and the only pushback could be if the limited partners in the funds say no to the general partner.

Bupa is seen to be ripe for the picking, with a good spread nationally and many large outdated properties giving opportunities to intensify accommodation. The Swedes could even partner with another investor, say Morgan Stanley, whose infrastructure fund is thought to have been interested in Metlife before this current takeover offer.

The industry is seen to have been focused on development, not mergers and acquisitions. Look out. If the talk results in any action, that could all change soon.

The right price?

The $6 per share offer for Metlife will be attractive for some but other shareholders want more, given that it is short of the underlying value of the assets.

Mark Brown, chief investment officer at Devon Funds Management, said there were clearly a lot of short term hedge fund investors looking to exit their positions.

“Many will be facing losses on this trade and will most likely be trying to minimise them in the shortest time possible. These investors have been clearly pushing Metlifecare management hard and will be very keen to accept a deal.” Brown said EQT’s current non-binding offer brings them back to the table within the range set by the valuers.

“I think a deal is very likely, albeit unfortunate for NZ capital markets.”

But Craig Tyson, head of Australasian property securities ANZ Investments, which has shares in Metlifecare, said while $6 was the right starting number it was a little light. “The range from the independent report is $5.80-$6.90, so we would be expecting a price north of the mid-point ($6.35).”

Tyson said EQT had emphasised that it was an investor with a longterm horizon and therefore shortterm house price headwinds should have little impact on the valuation of the business.

“Clearly New Zealand is a desirable place to invest for a bunch of reasons including our handling of the Covid crisis. Metlifecare is a good business with great assets and there would be few better places than NZ to invest so we have confidence in the board to negotiate the right outcome for investors.”

Private equity circling

EQT isn’t the only private equity player interested in New Zealand companies at the moment.

John Fisk, national leader of restructuring for PwC, told journalists this week that it was seeing a high level of interest from the PE sector.

“PEs are active at the moment. We are dealing with PEs that are looking at businesses I’m surprised they would be interested in.” Fisk said the interest included foreign PE investors from Australia.

“The Australians are interested in what we have got here.”

Last month the Government introduced temporary overseas investor changes so that the Overseas Investment Office must be notified of any investment in more than 25 per cent of a business or more than a quarter of a business’ assets, or increasing an existing shareholding.

Previously the OIO screened transactions over $100 million or involving sensitive land sales. The new rules will be reviewed every 90 days. Investors should find out within 10 working days if their transaction can go ahead while some may take longer to work through.

Fisk said the restrictions were something PE investors were aware of. “They can still take an interest in the company under 25 per cent.”

Fisk said investors were not focused on any particular sectors.

“It’s anywhere that is a better return than what they can get with money sitting in their bank.

“The part that I find interesting is that you have got very low interest rates, people that have got money to invest and yet we are walking into a storm of potential insolvencies.”

That could mean some PE investors pick up a good deal while others may get stung as they have in the past.

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