Stockland swoops on Australand stake in possible takeover precursor

Australia's largest diversified property group Stockland has swooped up a 19.9% stake in Australand, in what is seen as a prelude to a full takeover bid.

Stockland unveiled the "strategic stake" this morning, announcing it had obtained 115,166,597 securities in Australand at an average price of $3.78. This comprises a 15.7% direct holding and 4.2% indirect interest, it said.

The announcement came as Singapore's CapitaLand also revealed it had sold its remaining 39.1% interest in Australand for about $842 million (S$970 million).

Stockland chief executive Mark Steinert said Australand had a diverse and complementary portfolio of assets, including a quality industrial portfolio and medium density residential projects "that are well aligned with our strategy".

“Over time this holding will enable us to explore strategic opportunities with Australand.”

CapitaLand group chief executive Lim Ming Yan said the decision to divest its remaining stake in Australand was to the "favourable" market conditions and Australand’s share price had performed strongly in the past few months.

“This divestment would allow us to reallocate capital to our core businesses in Singapore and China,” he said.

Stockland's stake is being funded through cash and debt facilities and the transaction is expected to be broadly EPS neutral.