(24 May 2005 – New Zealand) Macquarie Bank is set to buy New Zealand aged care company ElderCare from parent Abano Healthcare Group for NZ$63.5 million.The deal is expected to be completed by the end of July.
The ElderCare acquisition will further expand Macquarie’s portfolio of aged care facilities, adding to the rest homes the bank already owns in Australia and Canada.
Abano chairman Jim Syme said the aged care sector was very capital intensive and required significant investment to maintain and upgrade facilities.
“We believe that the future of aged care industry in New Zealand lies with substantial organisations who have a lower cost of capital and who are able to spread administrative costs and achieve the required economies of scale,” Syme said.
He said the sale of the business would enhance the Abano Group’s profitability from 2005/06 onwards, with an expected increase in the company’s return on capital.