Dexus strikes $320m takeover deal with APN Property
Dexus has struck an agreement to acquire ASX-listed APN Property in a $320 million cash takeover that will bring fresh institutional capital along with real estate securities and direct property onto its funds management platform.
The bid from Dexus, which is led by Darren Steinberg, has the backing of Melbourne-based APN Property’s board, including the platform’s founder, chairman and largest shareholder, Chris Aylward, who has granted a call option to Dexus over his 19.9 per cent stake.
With a scheme implementation already struck, the mooted takeover will take Dexus’ funds management portfolio to $23.9 billion. The APN Property platform has $2.9 billion of funds under management, $134 million of co-investments in its managed vehicles and brings with it two ASX-listed property trusts.
Dexus’s proposal is an all-cash offer of 91.5¢ per APN security, well ahead of its Monday closing price of 61¢. The stock surged 28.7¢, or 47 per cent, during the day to 89.7¢ after the offer was announced.
“This transaction supports our strategic initiative of expanding and diversifying our funds management business, increasing our suite of funds on offer outside of wholesale funds into listed REITs, real estate securities funds and unlisted direct property funds,” Mr Steinberg said.
“The transaction also expands our investor network to include retail and high net worth capital.”
If the transaction goes ahead as expected, it will take Dexus, the country’s largest listed owner of office towers, into new growth opportunities through APN Property’s network of investors and investments.
The deal would boost Dexus’ adjusted funds from operations immediately as well.
Mr Aylward, who founded APN Property in 1996 before it subsequently listed in 2005, noted the takeover offer by Dexus represented a material premium to the fund manager’s soft trading price, a long-standing issue for the company.
“We believe the combination of the two platforms will provide incremental growth opportunities for the APN business as well as its underlying funds, investors and team members,” he said.
The offer requires approval from shareholders, who are expected to vote in mid-July on Dexus proposal.
The board has given its backing, subject to a superior proposal emerging and to the results of an independent expert’s report. Board members have indicated they will vote their stakes, including that of Mr Aylward, in favour of the takeover, amounting to 33 percent of the APN Property register.
Get a weekly roundup of the latest news from Commercial Real Estate, delivered straight to your inbox!
