This article is from the Australian Property Journal archive
AVEO Group has appointed Merrill Lynch as financial advisor for a strategic review of its retirement portfolio and operations.
“The strategic review will examine options and various initiatives to close the value gap between the price of Aveo’s listed securities and the underlying value of Aveo’s retirement properties,” the group said, while the introduction of capital partners into the retirement business will also be weighed.
Seng Huang Lee, chairman of Aveo Group, said the group’s current security price does not reflect the underlying value of its retirement business.
Aveo attracted unwanted attention early last year following a joint Fairfax and ABC investigation that exposed excessive fees and questionable regulations practices.
“The board also views that the factors likely impacting the current discount to net tangible assets are outweighed by the strong medium to long-term growth prospects for the sector,” Seng Huang Lee said.
“The factors include risks around sustainable sales levels including the current state of the residential market, further regulatory risk and the class action.”
It will look to narrow the discount of the price of securities to the current $3.92 net tangible assets per security.
Australian Property Journal
