Promisia Healthcare Progresses with Cromwell Acquisitions

Highlights:

• Strategic Expansion: Promisia Healthcare is acquiring Golden View and Ripponburn Lifestyle Villages, adding 106 care beds and 137 independent living units, significantly boosting their portfolio.
• Financial Backing Secured: Promisia has obtained a NZ$7.5 million debt finance offer from the Bank of New Zealand, with plans to raise an additional NZ$3 million in new capital to support the acquisitions.
• Shareholder Engagement: A special shareholders meeting is set for July 31, 2024, to vote on the transaction, with a capital raising initiative planned to ensure financial requirements are met.

Overview of Cromwell Acquisitions

Promisia Healthcare Limited (NZX: PHL) has provided an update on its acquisition of Golden View Lifestyle Village and Ripponburn Lifestyle Village in Cromwell. These acquisitions will enhance Promisia’s portfolio by adding 106 care beds, including a specialist dementia unit, and 137 independent living villas and apartments. This deal is set to be immediately beneficial, with the new assets generating an annual revenue of approximately NZ$10.5 million, which is about 40% of Promisia's FY24 operating revenue of NZ$26.3 million.

Transaction Progress

The transaction is still contingent on securing finance, obtaining shareholder and regulatory approvals, and other material conditions. Promisia has extended the deadline for fulfilling the finance condition to July 31, 2024, with the acquisition set to complete by August 14, 2024.

Promisia has secured a NZ$7.5 million debt finance offer from the Bank of New Zealand to support these acquisitions. To meet the conditions of this offer, Promisia must raise NZ$3 million in new capital and reach an unconditional agreement for the sale of its Eileen Mary facility in Dannevirke, which is expected to bring in NZ$3 million after debt. Negotiations for this sale are ongoing, and updates will follow.

Shareholder Meeting and Capital Raising

A special shareholders meeting is scheduled for July 31, 2024, to vote on the acquisition. Promisia will release a notice of the meeting to shareholders in the coming weeks. To raise the necessary capital, Promisia plans a capital raising initiative in July 2024, which will include placements and a share purchase plan for all shareholders. Details on pricing and terms will be announced soon.

BNZ Refinancing and Extensions

Beyond the acquisition financing, BNZ has extended NZ$6.6 million of existing facilities, initially maturing on October 18, 2024, for an additional two years. BNZ will also refinance an existing NZ$6.5 million loan from Senior Trust, set to mature on October 30, 2024. Promisia's Board views this lending offer as a strong endorsement of the company's robust performance and future prospects.

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