Ryman launches $1bn capital raise to “reset” balance sheet

24th February 2025 By Bridget O'Connell | bridget@propertyticker.co.nz | @propertyticker

Ryman Healthcare has launched a $1bn capital raise citing the need to reset its balance sheet.

The listed retirement village and rest home operator told the NZX this morning that the fundraise comprised of a $313m placement to institutional shareholders, to be conducted by Jarden Securities, Craigs Investment Partners and Forsyth Barr, and a $688m accelerated non-renounceable entitlement offer to existing shareholders.

Trading in its shares on the NZX were suspended this morning at the company’s request.

Ryman chair Dean Hamilton said the equity raise would reset the company’s balance sheet, reducing pro-forma gearing from 37.3% to 23.1%, enabling Ryman to deliver further transformation initiatives, with a renewed focus on an operational reset.

“We are on a journey and have already made significant transformation progress over the past 12 months, including our board, management and governance refresh, changes to our pricing model and moving to a functional structure,” said Hamilton.

“Resetting our balance sheet will support us to progress our business improvement programme further.”

The company would issue approximately 328 million new shares under the offer, representing about 48% of the existing shares on issue.

The placement and entitlement offer will be conducted at an offer price of $3.05 per share representing a:

• 21.9% discount to theoretical ex-rights price of $3.90;
• 29.2% discount to Ryman’s closing price of $4.31 on the NZX on Friday, 21 February 2025;
• and new shares issued under the offer will rank equally with existing fully paid ordinary shares from their time of issue.

The offer is underwritten by Craigs, Forsyth Barr and Jarden.

Under the entitlement offer, eligible shareholders are being invited to subscribe for 1 new share for every 3.05 existing Ryman shares held as at 5.00pm on Tuesday, 25 February 2025.

Ryman chief executive Naomi James, who joined the business in November 2024, said its improvement programme was focused on releasing more than $500m in cash from the business over the next three to five years. It was also targeting sustainable business improvement of around $100m to $150m in annualised cash improvement through both revenue and cost opportunities over three to five years.

“We are transforming how we operate so that our residents continue to have the best experience in retirement living, with access to industry leading care,” James said.

“Our continuum of care model uniquely positions Ryman to meet the increasing demand for aged care in New Zealand and Australia, which is growing rapidly ahead of the supply available in both countries.

“Since joining Ryman, I have seen first-hand our unique value proposition in the market, which offers our residents access to the level of care they require as their needs change, giving families the confidence their loved ones will be looked after through their later years.”

The trading halt is expected to end once the company was in a position to announce the outcome of the placement and entitlement offer on 25 February 2025 or before market open on the NZX on 26 February 2025.

Ryman was founded in Christchurch in 1984 and owned and operated 49 retirement villages in New Zealand and Australia. Its villages house 15,300 residents, and the company employed 7,700 staff.