GemLife Communities shares surge following $750m IPO
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The news: Luxury retirement community operator GemLife Communities shares have soared on its ASX debut following the completion of a $750 million initial public offering (IPO), the largest in Australia this year.
The numbers: Shares in GemLife opened 5.8% higher at $4.40 when the company floated on the bourse at 12:00pm AEST.
It was up 6.7% to $4.44 by 12:11pm AEST.
GemLife issued around 180.3 million shares at $4.16 each through its initial public offering.
Part of the funding will be used to fund a $270 million buyout of up to 12 land and development projects from rival Aliria Group.
The context: The operator of resort-style communities for the over-50s has a portfolio of 32 communities and projects which includes nearly 10,000 homes, inclusive of assets from the completion of the Aliria acquisition.
The communities generally provide access to facilities like gyms, swimming pools, theatres, and tennis courts. GemLife develops and sells new houses, but rents out the land that the houses are built on.
The model makes dwellings cheaper and means properties are exempt from stamp duty, council taxes, capital gains and land taxes. It also does not feature entry and exit fees that retirement villages generally charge.
The sources: ASX, GemLife IPO prospectus
