Metlifecare, the retirement village operator whose shares have jumped 60 per cent in the past year, plans to raise up to $80 million in a placement and share purchase plan as it rolls out its expansion plans.
The company's shares were halted for the placement of $70 million of shares to institutions. It will also raise up to $10 million in a share purchase plan.
Metlifecare had $134 million of debt at April 30, of which $33 million was classified as development debt and $101 million as non-development. Following the placement, non-development debt reduces to $14 million, a further $17 million is listed at land-backed debt and development debt remains unchanged.
The capital raising is "intended to ensure there is more capacity to progress consents and developments on our existing sites, allow us to further expand our greenfield land bank and fund the development of aged care facilities and services," said chairman Peter Brown, in a statement.
The company is aiming for a build rate of at least 200 new beds and units a year by 2015, it said.
The company had $198 million of debt post its 2012 merger with Vision Senior Living and Private Life Care Holdings. It subsequently reduced debt via the sale of two South Island assets, Oakwoods in Nelson and its Ilam development site in Christchurch.
Metlifecare has 23 villages with 3,812 units and 361 care beds. It has a pipeline of 903 units and care beds with 78 now under construction. It also has greenfield sites at Unsworth heights and Glenfield in Auckland.
In the 10 months ended April 30, the company settled 416 units, of which 322 were resales and 94 were new sales. That's up from 294 and 36 respectively in the 2012 financial year.
The shares last traded at $3.38 on the NZX. It is rated a 'buy' with a price target of $3.70, according to a Reuters survey of three analysts.