(Adds background on Brookfield, earlier offers)
July 2 (Reuters) - Hometown America adjusted its takeover bid for Australian retirement village owner Gateway Lifestyle Group on Monday, offering to drop due diligence if the target agreed to its A$695 million ($514 million) cash offer.
Hometown said its bid, at A$2.30 cash-per-share, was superior to an identically priced offer from Canadian private equity firm Brookfield Asset Management, because Gateway had promised to pay out a 5.35 Australian cents dividend during the bidding contest.
Hometown's cash offer would slip to A$2.25-a-share if Gateway was unwilling to sign a bid implementation agreement at the higher price. Gateway said it was considering the offer.
The bid implementation deal would contain features including a unanimous commitment by Gateway's board to recommend the bid, Hometown said.
Gateway agreed to an exclusive due diligence by Brookfield Property Group, a unit of Canadian alternative asset manager Brookfield Asset Management Inc, which made a non-binding A$2.30-a-share offer for Gateway on June 21.
Brookfield's offer trumped an earlier offer from Hometown of A$2.10 per share.
Investing in the retirement sector is viewed by analysts as a means to profit from Australia's ageing population and tap generous government subsidies offered to pensioners.
$1 = 1.3521 Australian dollars Reporting by Aaron Saldanha in Bengaluru; Editing by Stephen Coates