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SPH expands aged care business with C$232.9m Canadian acquisition

SPH aged care Canada.JPG
An exterior view of the Cedarview Gracious property in Woodstock, Ontario.

SINGAPORE Press Holdings (SPH) is acquiring six aged care assets in Canada for C$232.9 million (S$244.5 million), as part of its strategy to acquire cash-yielding assets in defensive sectors, the media and property group announced on Wednesday. 

SPH's wholly-owned subsidiary has entered into an agreement with affiliates of Columbia Pacific Advisors, LLC, and the deal is subject to "satisfactory due diligence", said SPH, which publishes The Business Times

The portfolio of six freehold assets comprises five independent living properties in Ontario and one assisted living property in Saskatchewan. In total, there are 717 suites with an average age of about seven years.

The properties, which are managed by Hawthorn Senior Living, have recorded occupancy rates in excess of 90 per cent over the past three years, according to SPH. 

The acquisition will be funded by a combination of internal funds and debt, and the transaction is expected to be completed by May 2020. 

Earlier this week, the group announced that it will purchase five aged care assets in Japan for 5.26 billion yen (S$65.8 million), as part of its strategy to expand to markets with fast-ageing populations.

"These acquisitions are in line with the group's strategy of expanding its aged care and healthcare business in overseas markets with favourable demographics," SPH said on Wednesday. 

Ng Yat Chung, SPH's chief executive officer (CEO), said that the group continues to seek cash-yielding assets in
defensive sectors to build up its recurring income base.

Added deputy CEO Anthony Tan: "Population ageing is set to be one of the most significant social transformations of the 21st century. In developed economies like Canada, Japan and Singapore, the growth prospects for services targeted at older persons like independent living facilities and healthcare are good.

"We will continue to seek opportunities in the senior living sector in economies with similar characteristics."

As at 9.19am on Wednesday, SPH shares were trading at S$1.98, up S$0.01 or 0.5 per cent.