This article is from the Australian Property Journal archive
Former childcare centre mogul Michael (Mike) Gordon is trying his hand at retirement villages by supporting Sunnycove Management in making a surprising off-market takeover bid for Village Life.
Gordon through his company Bydand Capital Pty Ltd is giving SCV financial support, with an initial funding commitment of $2.5 million.
Gordon, the former managing director and major shareholder (55%) of childcare centre owner and operator Peppercorn Management Group, collected $130 million after selling Peppercorn to ABC Learning Centres for $350 million in 2004.
Bydand Capital currently owns 21.1% stake in SCV and it also has a 13.99% interest in Village Life.
Yesterday, SCV made an offer of four SCV Shares for every 15 VLL Shares. Village Life currently has a market cap of $21 million.
SCV’s managing director Mark Roberts said the merger is a natural progression in the evolution of the seniors’ accommodation industry.
“SunnyCove combined with Village Life will become one of the largest seniors’ accommodation providers in Australia and Australia’s largest provider of rental accommodation for Seniors with communities operating in Queensland, New South Wales, Victoria, Tasmania, South Australia and Western Australia,” he added.
Roberts said the support from Bydand Capital reflects the high level of confidence that entity has in the senior housing sector and in particular the business model that will be pursued by the merged entity.
He added that the merger of SCV and VLL will provide the platform to create a clear market leader as a seniors’ accommodation manager with an enhanced valuation and lower risk profile through improved occupancy and scale.
“Most importantly, the merged entity will be able to enhance its development pipeline and gain access to new sources of funding (via third parties) for that pipeline development,” he concluded.
The offer is subject to a minimum acceptance condition of at least 90% acceptances amongst other conditions.
By Kathryn O’Meara
