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Canadian real estate fund NorthWest takes 9.6% stake in Vital Healthcare

Thursday 3rd November 2011

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Canadian private real estate firm NorthWest Value Partners has taken a 9.6 percent stake in the OnePath NZ managed-Vital Healthcare Property Trust.

The Toronto-based company has acquired 28.1 million units in the healthcare-focused property trust since Oct. 19, it said in a statement. That includes 18.1 million units from public workplace insurer Accident Compensation Corp on Nov. 1, for which it paid almost $20 million, according to a substantial shareholder notice.

“NorthWest acquired the units for investment purposes only and may, depending on market and other conditions acquire or dispose of further units from time to time,” the company said.

The company has acquired more than C$1 billion of real estate assets, and floated the NorthWest Healthcare Properties Real Estate Investment Trust on the Toronto Stock Exchange last year. The trust owns and manages a diversified portfolio of 45 income-producing properties, with a focus on medical office buildings, according to its website.

This year, NorthWest broadened its focus to look at global healthcare assets, with Australia and New Zealand, Germany and Brazil flagged for its initial investments.

In September, NorthWest paid 27.4 million euros to buy the German portfolio of Capital Care Group, having missed out on buying a stake in Australia’s ING Real Estate Healthcare Fund earlier this year.

The NorthWest stake comes as Vital Healthcare investors back away from the trust after OnePath owner Australia & New Zealand Banking shut down a bid to bring the management contract in-house, paying $31.2 million for a 9 percent stake.

OnePath owns the manager of Vital Healthcare whose negotiations with independent directors Bill Thurston and Graeme Horsley stalled over a $2 million price gap. OnePath wasn’t willing to accept less than $8 million to sell the management contract, having already slashed $6 million from its starting point.

Vital Healthcare’s units fell 0.8 percent to $1.19 in trading on the NZX today, and have gained 11 percent this year.

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