PSG Alpha has partnered with the Amdec Group to acquire a 50% stake in Evergreen Lifestyle
PSG Alpha Investments, a subsidiary of the JSE-listed PSG Group, has acquired a 50% stake in Evergreen Lifestyle, South Africa’s pre-eminent provider of retirement living and a division of the Amdec Group. With investments such as Capitec Bank (retail banking) and Curro Holdings (private education) in its portfolio, this investment marks a significant new focus area for PSG – a move into the retirement property sector.
The PSG Alpha investment amounts to a R675million subscription for new shares, one of the largest initial cash investments by the group. This partnership between two powerful national brands provides even greater peace of mind for the rapidly increasing number of middle to upper-income retirees.
“Our investment mandate is to invest in and work with businesses that show high growth potential for the future,” says Nico de Waal, chief executive officer of PSG Alpha.
“With this approach, we focus on identifying suitable businesses for a long-term commitment, ones that we are confident will deliver satisfactory returns for shareholders. With its competitive advantage, intellectual capital and deep-rooted expertise in the retirement property development sector, Evergreen Lifestyle meets these criteria and is ideally positioned to entrench and grow its position as a leading provider in the retirement landscape in South Africa.”
The Amdec Group’s portfolio of real estate investments and property developments include the Melrose Arch mixed-use precinct in Joburg, The Yacht Club in Cape Town, Westbrook in Port Elizabeth, and Val de Vie and Pearl Valley in the Cape Winelands.
The group also recently announced a partnership with Marriott International to develop five new hotels in South Africa, and will soon launch Harbour Arch, a R10billion project at the gateway to the Cape Town CBD.
James Wilson, chief executive officer for the Amdec Group says: “We are always looking for opportunities that make good business sense for our group and our clients. We believe the retirement market in South Africa has not been well conceived or developed. We have analysed global trends in retirement accommodation and we believe we can meet the increasing demand for a better retirement lifestyle within quality houses and state-of-the-art villages.”
Arthur Case, Evergreen Retirement Holdings’ chief executive officers, says: “Our offering stretches far beyond the stereotypical old-age home with its hospital-like atmosphere. Ours is a hospitality-based approach with resort-style facilities and amenities in all our villages, where you’ll find vibrant communities of residents enjoying an active, independent retirement lifestyle. When the need arises we are able to match lifestyle to life stage with care offerings to respond to the challenges of ageing.”
Wilson says the PSG Alpha deal is of great importance for Evergreen Lifestyle as it will accelerate the growth of the brand and allow rapid development of retirement villages currently in planning stages.
“This injection of capital means we can rapidly expand our offering from the current 500 homes to approximately 3000 homes over the next three years. The demand for quality accommodation exists and is swiftly outstripping supply.”
For PSG, a number of factors make Evergreen Lifestyle an attractive company in which to invest. It is one of the leading retirement accommodation brands in South Africa and is backed by the pioneering Amdec Group with a strong and proven track record.
It has successfully rolled out the life right purchase model for retirement accommodation in South Africa, as opposed to the traditional method of sectional title or freehold.
The life right purchase model gives peace of mind to retirees and their families because Evergreen Lifestyle remains vested in the scheme and ensures every aspect of the village is taken care of. It comes with flexible payment structures and a range of accommodation options to suit every preference and pocket.
The PSG Alpha investment is noteworthy in both the property and investment sectors in South Africa.
It brings together a major player in the financial services sector and a leader on the national property front. It represents a long-term commitment by both parties – PSG via its capital investment and proven track record to help grow new businesses, and the Amdec Group through construction, development and knowledge of the retirement sector – and confirms both parties’ commitment to invest in South Africa.