Update on Aveo Sale

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It appears that one potential buyer of Australia’s second largest retirement village operator, Aveo, is left at the negotiating table.

Following media speculation, Aveo came out last week confirming that “the preferred party in Aveo’s Strategic Review process is Brookfield Property Group, together with its affiliates and their managed funds (“Brookfield”)”.

Monday week (22 July) is expected to be the announcement date for a deal – or no deal.

Brookfield originated in Canada but is largely American-driven. The Australian newspaper reports they have $6 billion to invest in Australasia over 12 months, with Aveo likely to account for around $1 billion.

The expectation is that the existing dominant shareholder, Malaysia/Hong Kong-based Mulpha with 24%, will stay on the share registry at a reduced level.

Aveo has exceptional latent value, given its share price is currently hovering at $2.00 which is down from $3.60 24 months ago prior to the savage Four Corners program. Since then they have delivered hundreds of high quality new village homes that are waiting to be sold.

Time and the re-emerging positive housing market may be well perfect for Brookfield.