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Law360 (July 6, 2020, 12:49 PM EDT) -- Metlifecare said Monday that an EQT affiliate slashed the offer price for the New Zealand retirement community operator to NZ$1.27 billion ($831 million), in a move that comes after the companies had squabbled over whether the deal could be terminated because of the coronavirus pandemic.
The updated, nonbinding indicative offer from Asia Pacific Village Group Ltd., or APVG, values Metlifecare at NZ$6 per share, according to a statement. That's $1 per share lower than the original deal signed in December. The revised bid is contingent upon Metlifecare dropping a lawsuit against APVG over the entity's April attempt to nix the transaction.
In seeking to cancel the deal, APVG — which is owned by EQT Infrastructure IV Fund — had cited "material adverse changes" caused by COVID-19.
With the new takeover offer in hand, the board of Metlifecare said it will engage with APVG "in good faith."
Kim Ellis, chair of Metlifecare, said in the press release that "we have always indicated that the board of Metlifecare is open to engaging on any reasonable alternative proposal."
"We welcome receipt of APVG's [offer] and intend to canvas shareholders on whether they prefer this alternative," Ellis said. "While there remain a number of issues to resolve and there is no guarantee we will be able to reach agreement, we look forward to productive discussions with APVG."
Metlifecare was originally planning to hold a shareholder meeting on July 10 to discuss the litigation it had initiated in connection with APVG's attempt to pull out of the deal, but that meeting will now be deferred. It wasn't clear Monday when the meeting would take place.
The amended offer features no material adverse change condition. It includes a requirement that a majority of Metlifecare directors recommend shareholders vote in favor of the deal.
The original deal valued Metlifecare at NZ$1.5 billion ($900 million). After the COVID-19 outbreak began wreaking havoc on the world, APVG sought to escape the agreement, noting that the coronavirus had contributed to a significant decline in the value of Metlifecare's net tangible assets and would likely affect its profits. In response, Metlifecare said the justification for nixing the deal was "simply wrong."
Metlifecare owns and operates a portfolio of 25 retirement villages in New Zealand, according to its website.
APVG is merely one of many companies that have tried to back out of a deal as a result of the pandemic. In April, a CorePower Yoga LLC franchisee sued the yoga studio chain, alleging it was trying to use coronavirus-caused studio closures to back out of an agreement to buy 34 studios. Also in April, retailer Bed Bath & Beyond Inc. accused 1-800-Flowers.com Inc. of stalling on its $252 million purchase of Personalizationmall.com, saying 1-800-Flowers was using the COVID-19 crisis to breach a firm deadline.
A representative for EQT declined to comment Monday.
Metlifecare is advised by Jarden Partners Ltd., Simmons Corporate Finance Ltd. and New Zealand law firm Chapman Tripp.
Legal counsel information for EQT was not immediately available.
--Additional reporting by Elise Hansen, Rose Krebs and Jeff Montgomery. Editing by Alyssa Miller.
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