April 27, 2020 / 10:07 PM / a month ago

NZ's Metlifecare rejects EQT's notice to terminate NZ$1.5 bln buyout deal

April 28 (Reuters) - New Zealand’s Metlifecare Ltd on Tuesday rejected a notice to terminate a NZ$1.49 billion ($899.66 million) buyout offer from Swedish private equity firm EQT AB and said it plans to go ahead with the deal.

EQT’s unit, Asia Pacific Village Group Ltd (APVG), earlier this month said it intended to terminate its offer for the retirement village operator, citing impact from the coronavirus pandemic on Metlifecare’s assets and expected earnings.

In a response dated April 27 to Metlifecare’s decision to continue to proceed with the scheme, EQT reiterated its stance that the scheme agreement allows it to terminate its bid in the situation where it appears likely that Metlifecare’s asset value or underlying net profit would drop by certain parameters agreed upon.

Meanwhile, Metlifecare said it remains committed to completing the deal, asserting there was no lawful basis for termination.

Regarding any likely impact to its earnings or asset value, Metlifecare said it was “the result of changes in general economic conditions or changes in law as part of the New Zealand government’s Level 4 lockdown restrictions.”

“There is no basis to suggest that these changes in general economic conditions and changes in law have had a materially disproportionate effect on Metlifecare,” the company added.

EQT’s sweetened bid was at NZ$7 per share in December. As of last close, Metlifecare’s share price was NZ$4.08, and the stock has fallen about 40% since the December bid. ($1 = 1.6562 New Zealand dollars) (Reporting by Arundhati Dutta in Bengaluru Editing by Matthew Lewis)

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