Metlifecare founder behind stake sale buzz

Another shaft of light through the rumours swirling around Metlifecare: it is founder Cliff Cook who is looking to sell a 25 per cent stake in the company, worth $67 million at yesterday's market price.

Market sources say investment banker Goldman Sachs JBWere may run the sales process after earlier efforts by David Belcher, of Clavell Capital, to sound out possible buyers.

No comment was available last night from Cook, Belcher or Goldman Sachs.

Asked about a sales process for the stake, Metlifecare chairman Peter Fitzsimmons said: "The company has not received at this stage any formal notification of that."

Metlifecare's share price jumped 36c in three trading days to $3.10 after the National Business Review put takeover talk on the record last Friday.

The shares were yesterday trading at $3.11 - up 38 per cent for the year to date.

Listed 10 years ago, Metlifecare is a property owner and retirement village operator with a market capitalisation of $269 million and two main shareholders - Cook and Todd Capital, a part of the Todd family empire, which is on 35 per cent.

Under takeover laws, a sell-off will trigger a takeover offer to all shareholders, including Fisher Funds (13 per cent) and just under 2000 small shareholders.

Cook's bid to sell triggers a pre-emptive right

A five-year "standstill" agreement where Cook and Todd agreed not to buy or sell more shares - a device intended to block then-investor Eric Watson from bulking up his stake - has just expired. If either Cook or Todd want to sell out, the other party has first right of refusal.

According to a news report in 2000 on the deal between Cook and Todd, three kinds of rights are involved - pre-emptive, drag-along and carry-along.

If one party does not take up its pre-emptive right to buy the other's stake, the party selling can drag its partner along for a sale of their combined stakes to a third party.

On the other hand, if one party decides to sell, the other can insist its stake be included.

The speculation in the market is that bad blood between Cook and Todd is part of the background to the possible sell-off, with Cook in favour of more aggressive growth.

Cook has also snapped up Metlifecare's chief executive, Gavin Aleksich, for Renaissance Lifecare, his start-up retirement village company in Britain.