Listed landlord ING Property Trust lodged its formal takeover offer for rival landlord Urbus Properties yesterday, offering almost one ING unit for every Urbus share.
The $80 billion real estate arm of the $1 trillion Dutch-based ING empire mounted the long-awaited takeover, first flagged last year.
The trust's offer to
take over the $400 million Urbus will open on April 27 and close on June 3.
If successful, the takeover will result in the emergence of one of the country's largest listed property entities, second only to the $1.2 billion Kiwi Income Property Trust.
If Urbus shareholders accept the offer, ING will then manage $800 million worth of real estate assets against total liabilities of $250 million and have a new market capitalisation of about $550 million.
ING offered .98 ING units for every one Urbus share, which it said was a 9 per cent premium to Urbus' share price. ING's units were yesterday trading at around $1.14 and Urbus shares around $1.05.
Urbus has about $20 million of mandatory convertible notes on issue, whose holders are being offered one ING unit for every Urbus note.
ING's documents sent to Urbus shareholders argue that they should agree to the deal for potential cost savings of the combined group, greater investment opportunities and a simplified capital structure.
ING already owns the Urbus management, via a joint venture with Symphony Group. The ING and Urbus boards have backed the takeover, saying it will result in a larger and more diversified property portfolio, lower debt levels and greater liquidity.
