Metlifecare investor Fisher Funds expects cornerstone shareholder Retirement Villages NZ to retain a large holding in the business and only sell part of its controlling stake.
Murray Brown, Fisher's senior investment analyst for New Zealand equities, said the Australians look likely to keep a big slice of the business.
"My understanding is that the major shareholder would be selling down but not out. It would result in a bigger free float of the company which would be a good thing," he said.
Fisher owns 8.7 per cent of Metlifecare but in a highly unusual situation Retirement Villages holds 81.95 per cent.
Metlifecare is listed on the NZX but not in a totally free float situation, resulting in many analysts rejecting the stock.
Brown's comments followed statements by Greg Flood, chairman of Metlifecare, who is also the chief executive of Retirement Villages who told this week's annual meeting at Ellerslie how a sale was "on the table" but refused to be more specific until Goldman Sachs released a strategic review in about a fortnight.
Brown is expecting the Goldman document in the next two weeks but he sees a wider shakeup, possibly Metlifecare issuing new shares because the business needed new equity to expand and cut debt.
"We don't know for sure but one way for them to do that would be to issue new shares. That would get the borrowing down and Retirement Villages would sell some of their shares," he said.
"Ideally, Metlifecare needs to get their borrowing down. They don't have a lot of head room to build more villages which they hope to develop on the existing operations, which makes sense because they already have existing communal facilities."
Fisher might buy further shares, he said, but needed to wait to see what was proposed. It has not had discussions with fellow stakeholders the NZ Super Fund, with 3.84 per cent, or MFL Mutual Fund, with 2.92 per cent, he said.
Retirement Villages is a joint venture between Macquarie Bank and Australian property company FKP.
Retirement ended up owning the large stake when in 2005, a $341 million takeover bid for Metlifecare fell short of the 90 per cent compulsory acquisition target after Fisher rejected the $3.90 a share offer.
Carmel Fisher of Fisher has also backed any capital restructure and hopes Retirement Villages would sell down to create more liquidity.
The company made $20.7 million profit in the June 2011 year on the back of $65 million operating revenue, compared with last year's $67.4 million profit after $62 million operating revenue.
Dividends are suspended indefinitely, a situation Flood said was also being examined.