Bid trail for Australand goes cold as no fresh GPT offer emerges

A suitor has not emerged for Australand in the month since the property developer closed its data room, the Australian Financial Review has noted in its Street Talk column.

The data room refers to confidential information that is made available to selected interested parties, who may or may not make a bid for the Australand business.

Three weeks ago Australand boss Bob Johnston was talking of a deal being finalised within six weeks.

Australand rejected a $3 billion non-binding bid by GPT for its commercial and industrial property businesses – but not its residential property business - in December last year.

The last word on the bidding process was delivered by Australand chairman Oliver Lim and deputy CEO of Singapore-based CapitaLand, the 60% majority shareholder, on April 22 at the Australand AGM.

Lim noted at the AGM that Australand shares were trading at a signficant discount to their net asset backing making its 60% holding a potentially attractive investment option for a single institutional share trade.

He said "alternatives" to the GPT offer would be explored that may or may not result in a proposal for shareholders.

GPT was expected to make a higher offer for Australand in February after its annual results were published, but has yet to do so, perhaps caught up in resolving its class action lawsuit with a group of investor, only settled today with a $75 million conditional agreement.

A month before, in January, CapitaLand announced it would undertake a strategic review of its investment in Australand with a possible block sale of its shares one possibility.

The last official word on a better offer for Australand was delivered by GPT chief executive Michael Cameron, who said at the group’s annual results briefing that he wouldn’t be talking about Australand but that GPT was “committed to advancing a proposal that is in the best interests of Australand and GPT securityholders”.

Street Talk speculates that a block trade of CapitaLand’s stake would “test the market’s appetite for listed real estate”.

The Australand share price has been on an upwards trajectory since GPT’s failed December bid rising from around $2.85 to currently trade above $3.64.