Retirement home operator Metlifecare is planning to raise up to $115.5 million, in part by reducing the stake of its major shareholder.
The company says it will raise up to $45.5 million by offering new shares.
Retirement Villages New Zealand will also reduce its 82% stake to no more than 55%, raising about $50 million to $70 million.
Metlifecare managing director Alan Edwards says the extra cash will help fund the company's growth and should allow dividends to be restored next year.
Mr Edwards says the board structure will also be changed to include three independent directors, three RVG representatives and himself.
Shares in the company are on a trading halt and closed at $2.26 each on Tuesday.