Frasers' Australand takeover bid still short as deadline draws closer

Frasers' Australand takeover bid still short as deadline draws closer
Frasers' Australand takeover bid still short as deadline draws closer

Frasers Centrepoint's $2.6 billion takeover bid for Australand Property Group is still short of the 50.1% required by this Thursday’s deadline.

A flood of acceptances is expected in the final hours of the offer, although some warn the deal will fail to reach the unconditional stage.

Hedge funds control close to 40% of the register. They invested in the hope Stockland would extend a sweetened offer. Stockland owns 19.9% of Australand.

With acceptances sitting at below 10%, earlier this week security holders were reminded the Australand Directors unanimously recommended acceptance of the Fraser's offer in the absence of a superior proposal.

"We note that the offer cannot be extended unless Frasers’ voting power in Australand increases to more than 50% or a competing takeover bid emerges before the closing date," the letter from Australand maning director Bo Johnston said.

The letter indicated the current status of the offer was as follows:

  • The Offer consideration of $4.48 per Australand Security (with the entitlement to the Allowed Distribution) is Frasers best and final offer in the absence of a competing proposal (as previously announced on 28 July 2014);

  • Should Frasers achieve acceptances for more than 50% of all Australand Securities, including under the Institutional Acceptance Facility (IAF), prior to the Closing Date, and at that time no other condition of the Offer has been breached, Frasers has stated that it will immediately declare the Offer unconditional.

    Assuming the Offer becomes unconditional on 7 August 2014, the Allowed Distribution will amount to $0.0263 per Australand Security. In this case, Securityholders who accept the Offer and are on the Australand register on the Allowed Distribution Record Date would receive total proceeds under the Offer and the Allowed Distribution of $4.5063 per Australand Security.

    We also note that should Frasers not achieve acceptances for more than 50% of all Australand Securities or a competing proposal does not emerge by 7 August 2014, the Offer will lapse and Australand Securityholders will no longer be able to accept the Offer, and any acceptances received under the Offer will be of no effect. As such, if Securityholders wish to receive the Offer consideration they should accept now.

    Australand has established a Securityholder Information Line which Australand Securityholders should call if they have any queries in relation to the Offer. The telephone number for the Securityholder Information Line is 1800 882 147 (toll free calls within Australia); or +61 1800 882 147 (for calls outside Australia).

Jonathan Chancellor

Jonathan Chancellor

Jonathan Chancellor is one of Australia's most respected property journalists, having been at the top of the game since the early 1980s. Jonathan co-founded the property industry website Property Observer and has written for national and international publications.

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