Following months of sagging stock prices and riding the wave of consolidation in the senior housing industry, Vancouver-based Amica Mature Lifestyles Inc. has agreed to a a buyout by BayBridge Seniors Housing. The transaction totals more than $500 million Canadian dollars, and moves Amica from the public to the private sector.
Under the agreement announced Wednesday, Amica shareholders will receive C$18.75 in cash per share, which represents a premium of 113% to the closing price of the shares on the Toronto Stock Exchange on Sept. 1, according to a news release. This puts the total price at C$578 million, according to Reuters, which comes out to about $435.7 million in the United States.
Amica, a provider of luxury senior residences, is involved in the development, design, marketing, management and ownership of 26 properties located in Ontario, British Columbia and Alberta.
The acquisition is pending the approval of shareholders at a meeting to take place Oct. 9 and of the court under the Canada Business Corporations Act. The deal is also subject to applicable regulatory approvals, certain lender consents and other factors.
“This is more of an expression of confidence in the industry and the strength of the Amica brand than it is about moving from public to private,” Michael Hayward, Amica’s vice president of marketing and communications, tells SHN.
BayBridge, a wholly owned subsidiary of the Ontario Teachers’ Pension Plan, owns, operates or invests in 41 senior housing communities comprised of independent living, assisted living, and memory care. Six facilities are located in the United States, and the rest are situated in Alberta, BC and Ontario.
The Amica transaction, facilitated by Teachers’ Private Capital’s Long-Term Equities group, which focuses on direct investments that demonstrate growth potential in the long run, comes in the wake of the sales of other Canada-based companies.
Regal Lifestyle Communities was acquired by Health Care REIT (NYSE: HCN) and Revera, Inc. for $632 million in June, and Extendicare Inc. finalized the sale of its U.S. business for $870 million in July.
Both U.S. and domestic senior living developers continue to eye the Canadian market, and more than one is pursuing $1 billion pipelines. Montreal-based Le Groupe Mauric, for example, intends to build 17 senior housing complexes throughout Quebec and Eastern Ontario over the course of the next five to six years. Such large pipelines are being made possible, in part, because investors see demographics as highly favorable.
Although Hayward wouldn’t comment directly on where the Canadian senior housing market is headed, he says it’s clear that investors see promise in the sector.
“There really is a great story in the way that BayBridge and its investors looked at the long-term potential for senior living in Canada,” he says.
Written by Kourtney Liepelt