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Infratil, NZ Super buy RetireAustralia for A$640m

The pair’s investment in Australia’s fourth-biggest retirement village operator follows their 2010 purchase of Shell New Zealand’s downstream assets.

A consortium formed of Sydney- and Auckland-listed fund Infratil and New Zealand Superannuation Fund (NZ Super) has acquired RetireAustralia, the country’s largest privately-held pure-play retirement operator.

Both partners, which will each own 50 percent of the business, have paid a total consideration of A$640.2 million (€436.5 million; $519.2 million) for the asset. This comprises A$429.5 million of equity and A$23.5 million of transaction costs, with the balance funded by existing bank debt on RetireAustralia’s balance sheet.

The investment will be managed by Morrison & Co, a New Zealand-headquartered firm which manages Infratil as well as a number of NZ Super investments.

Headquartered in Brisbane, RetireAustralia runs 28 retirement villages in New South Wales, South Australia and Queensland. It owns and operates a total of 3,700 villas and apartments and has plans to build a further 500.

The company anticipates strong growth in demand for retirement amenities in years to come, with the population aged over 65 near-doubling from 2.3 million of Australians in 1999 to 4.5 million in 2021.

“The sector’s attractive demographics and future growth opportunities make it a good fit for longterm investors such as the NZ Super Fund,” said Matt Whineray, chief investment officer at NZ Super, in a statement.

The deal marks the second consortium formed by Infratil and NZ Super to acquire antipodean assets, following their 2010 purchase of Shell New Zealand’s downstream assets for NZ$696.5 million (€453.1 million; $539.1 million). This investment was also managed by Morrison & Co.

Rechristened Z Energy, the company was listed on the New Zealand and Australian stock exchanges in August 2013, following which Infratil and NZ Super’s joint stake was brought down to 40 percent.