Washington H Soul Pattinson, fresh from its $11.1 billion merger with ASX-listed investment company Milton Corp, admits it has turned its intention to aged care.
CEO Todd Barlow (pictured right with Chairman Bob Milner) told the AFR Soul Patts, whose interests are telecommunications, building products and industrial property and resources, was looking towards new sectors – aged care, financial services and agriculture (horticulture).
Sout Patts has long held interest in the aged care sector. It bid unsuccessfully for ASX-listed Regis Healthcare in late 2020, as we reported last November.
“Health and the ageing population is definitely one of those things we’ve done a lot of work on,” Mr Barlow said.
“I’m sure that we can build out some very significant investments, and given the ageing population this is one area, and we really like what Provectus is doing.”
Soul Patts and its partner, aged care operator Shane Moran, of Provectus Care, have DA approval for their Sage By Moran $80 million project at Cronulla, as The Weekly Source reported earlier this month. Mr Moran has said that the partnership is likely to continue.
Mr Barlow also did not rule out going back for another tilt at Regis but noted there are plenty of good quality assets Soul Patts could sink its teeth into and build up a platform with the right partners.
With more than 50% of operators making a loss, the sector is ripe for picking.
“With the increase in administration and regulation costs, it’s not really efficient to run smaller operations,” Mr Barlow said. “There’ll be a desire for a number of players to get bigger and because of our play on Regis last year, there has been a lot of people approaching us now so our universe of opportunities is very large.”
He admitted it was hard to compete with Not For Profit organisations, which are generally exempt from stamp duty, and exempt from fringe benefits tax.
“As much as they have a competitive advantage, they don’t have the scale advantage we can bring to the industry. By investing in the right systems, people and assets we can overcome those competitive disadvantages in other ways,” said Mr Barlow.