22 Jan 2020

Metlife stakeholders sell up despite backing takeover deal

12:35 pm on 22 January 2020

Big institutional investors in retirement village company Metlifecare have cashed in some of their stakes and taken a profit rather than wait for a possible takeover offer to run its course.

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Photo: 123RF

Official market disclosures show ANZ Investments and Investment Services Group have cut their stakes in Metlife from 11.8 percent and 7.7 percent respectively, to below 5 percent, the level required to be classified as substantial shareholders.

The sales appear to make the bid by Swedish-backed investor EQT Infrastructure, which is offering $7 a share and has the backing of the Metlifecare board and major shareholders including the Superannuation Fund, slightly more difficult.

ANZ Investments' head of Australasian listed property, Craig Tyson, said EQT's offer was only slightly above what the share price was trading at, so it decided to take the money early and reinvest it elsewhere.

"If we were to hold onto the shares until May or maybe even June when we would get the money in from the acquirer [EQT], [it] is probably not enough return for the risk," he said.

"We think we can do better with the money investing elsewhere."

Metlifecare's shareprice has risen about 13 percent since the offer, which values the company at about $1.5 billion, emerged in late December.

Tyson said he was not concerned its sell-down would stymie the deal because the buyers of its shares would likely support EQT's proposal to buy Metlife.

Investment bank UBS has been a buyer and now owns a 5.5 percent stake.

EQT still has the support of the Superannuation Fund, which owns about 20 percent of Metlife.

Tyson said ANZ has told EQT about why it sold out.

"We were happy to share our thoughts as to why we were selling. They thought it was a reasonable explanation. It is something investors do."

"While we don't like to see companies taken off the stock market, and there is a shortage of really good quality companies on the NZX, when we are offered a price that justifies us making a decision, we have to consider it," he said.

EQT and Investment Services Group have been contacted for comment.