Australand dismiss Stockland's takeover attempt as "incomplete"
Australand Property Group revealed this morning that it had received a takeover proposal from Stockland Group, but that it was dismissed by the board as an "incomplete" bid.
Last month, the diversified property group snapped up a 19.9% stake in Australand, in what was seen as a prelude to a full takeover bid.
In a strongly worded statement, Australand said it had received an "unsolicited, indicative, non-binding and incomplete proposal" from Stockland to acquire the remaining shares it did not own.
The offer was an all-scrip offer of 1.111 Stockland securities for each Australand security. Based on Stockland’s closing price of $3.78 on 22 April 2014, Australand said it implied an offer price of $4.20 per Australand stapled security.
Australand said the board reviewed the proposal, in conjunction with its advisers, Fort Street Advisers, Macquarie Capital (Australia) Limited and King & Wood Mallesons, but rejected it on the grounds that it "did not consider that the terms and conditions of the proposal are compelling, nor does it provide sufficient consideration to Australand security holders in the context of a change of control."
As part of its review process, the board took into account the outlook for the group, and noted that the offer also represented "a 1.9% discount to the Australand closing price of $4.28 on 22 April".
But Stockland defended its offer, saying it believed the current Australand trading price already reflected a "significant takeover premium to the price at which Australand would trade, absent Stockland's interest".
Stockland also said it believed there was "compelling strategic merit" in a combination of the two groups, with benefits for all stakeholders".
Stockland chief executive Mark Steinert warned Australand "if investor price expectations are too high, we will sell and realise a profit on out 19.9% holding."
"In this regard, we believe the 18% offer premium to ALZ's stated NTA is highly compelling.
"Given the terms outlined in the Proposal, the Board has determined not to provide Stockland with access to due diligence material and remains focussed on maximising security holder value," the company said.