AMP Life increases stake in aged care
AMP Life and GK Goh Holdings (GK Goh) have become equal stakeholders in the AMP Capital managed residential aged care provider, Domain Principal Group (DPG), following a $136.7 investment from GK Goh.
AMP Life also increased its ownership from 42.5 per cent so that both companies now own 47.62 per cent of the venture, with DPG management holding the remaining stake and AMP Capital staying on as manager.
The pair plan to invest an additional A$50 million to finance further investment in Australia's aged care sector, an industry AMP Capital has been invested in since 1999. GK Goh is also part owner of retirement villages in Western Australia due to a fund it has a significant stake in.
"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, AMP Capital Head of Aged Care Sally Evans said.
She said AMP Capital has invested significant funds in upgrading the business.
"The DPG business is performing strongly with increased occupancy and a recent allocation from the Federal Government for another 385 new beds at DPG facilities," she said.
"With the residential aged care sector expected to grow by 40 per cent in the next 10 years, as the population ages, an estimated A$25 billion of capital will be needed to fund new places and rebuild existing homes."
The transaction is subject to a number of approvals, including from GK Goh shareholders and Australia's Foreign Investment Review Board.
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