Securityholders in Investa Office Fund will meet next Monday to vote on Blackstone Group’s sweetened $3.3 billion takeover bid.
Blackstone Group has declared its $5.52 per share offer as a final price, meaning it cannot be raised if someone else offers a higher price.
The securities closed at $5.53 yesterday after Investor securityholders met in Sydney to discuss the offer and adjourned the meeting to next Monday.
The US investment giant increased its offer for the Sydney-focused landlord last week in response to a rival bid from Canada’s Oxford Properties Group.
Oxford, which already owns 10% of Investa, offered $5.50 per security compared with Blackstone’s previous bid of $5.3485 per share.
Investa chair, Richard longes told the meeting yesterday:
“On Tuesday 4 September 2018, a conditional and non-binding proposal was received from the Oxford Properties Group for the acquisition of all of the units in IOF for $5.50 per unit. The Oxford proposal is subject to a number of conditions, including completion of confirmatory due diligence, final investment committee approval, FIRB approval, confirmation of third-party financing, execution of a scheme implementation agreement and a recommendation from the board of the Responsible Entity.
“As announced earlier this morning, the Board has also received late last night a letter from Blackstone in which Blackstone stated that it was prepared to increase the actual consideration payable under its trust scheme from $5.3485 per unit to $5.52 per IOF unit. The Board intends to negotiate with Blackstone to give effect to the price increase and will provide unitholders with an update as soon as possible.
“In light of these developments, I have, with the support of the directors, and consistently with judicial advice received from the Supreme Court of New South Wales, determined to adjourn the meetings to ensure that the Board of the Responsible Entity has sufficient time to consider the developments and update unitholders accordingly,” he said.
A later meeting revealed the new date and the result of talks with Blackstone to formalise the offer.
Analysts say the battle for the fund is a sign the search for yield by global investors.
The Australian commercial property sector remains solid, even though housing and apartment prices and rents are falling, especially in Sydney and Melbourne.
Commercial rents are reportedly holding up, especially in Sydney, where CBD capacity is tight.
