AMP increases residential care stake

Singapore’s GK Goh has joined AMP Life as a 47.62% shareholder in Domain Principal Group, an AMP Capital-managed asset.

Singapore investment firm GK Goh has acquired a 47.62 percent stake in Domain Principal Group (DPG), an Australian privately owned aged care provider, in a A$136.7 million (€94.3 million; $125.8 million) deal.

Concomitantly, AMP Life has also claimed an interest of 47.62 percent in the business – having previously held 42.5 percent. The deals were made possible by some existing shareholders deciding to “reweight their portfolios and exit the investment” according to an AMP Capital press release.

DPG was – and will continue to be – managed by Australian fund manager AMP Capital on behalf of GK Goh, AMP Life and the DPG management team, which owns the remaining 4.76 percent.

Announcing their stake purchases, GK Goh and AMP Life said they planned to invest a further A$50 million in Australia’s aged care sector.

AMP Life, the life insurance arm of AMP, has been investing in the sector since 1999, while GK Goh – through a fund in which it has a “significant” stake – is a part-owner of retirement villages in Western Australia.

“The transaction gives DPG the opportunity to grow through investment in the existing 55 facilities as well as building new state-of-the-art homes and potential acquisitions,” said AMP Capital head of aged care Sally Evans in a statement.

She added that DPG has enjoyed increased occupancy and was recently allocated an additional 385 new beds by the federal government. She also noted that the residential aged care sector in Australia is expected to grow by 40 percent in the next 10 years and that A$25 billion of capital will be needed for new places and re-building.

The deal is subject to various approvals, including from GK Goh shareholders and the Foreign Investment Review Board in Australia.