Majority shareholder CapitaLand to review its investment in takeover target Australand

Australand’s biggest shareholder, Singapore-based CapitaLand, is considering divesting from the residential property developer, as takeover rumours continue to circulate.

Should CapitaLand go ahead and sell out of Australand it could clear a hurdle allowing larger property development rival Mirvac to make a formal bid for Australand, following a failed $3 billion offer from another listed developer, GPT.

A statement posted by Australand to shareholders on the ASX says that CapitaLand, which owns 59% of Australand, is to “conduct strategic review of its investment in Australand”

Australand says it has appointed Macquarie Capital, Fort Street Advisers and law firm King & Wood Mallesons as advisers to its board with directors to keep securityholders informed of any “material developments as they occur”

The Australian Financial Review said these appointments were to bolster Australand’s defences as it “braces for a potential barrage of buyout proposals”.

In December last year, Australand rejected an unsolicited, non-binding proposal from GPT to acquire much of its core business.

GPT had offered $3 billion for Australand’s entire commercial and industrial business, but not its residential development business.

Following the rejection of the GPT proposal, there was also speculation that Mirvac was considering a proposal to acquire the entire Australand business that would have created a a $7 billion listed property trust.

On December 18, the Australian Financial Review reported that a bid by Mirvac was being considered by new Mirvac boss Susan Lloyd-Hurwitz, following earlier discussions instigated by former managing director Nick Collishaw.

The AFR article did not name any source for its story, but said the proposal was being considered by Mirvac advisers Citigroup and was at an “early stage”.

Mirvac has not made any official statement about a bid for Australand.

For the Mirvac deal to go through, it would need the backing CapitaLand.

The Australand share price traded up 3¢ to $3.47 yesterday.

Larry Schlesinger

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer

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