AMP eyes more of Capital

AMP Property Portfolio has won the battle for the country's fourth largest listed property investor but is still fighting to get full control of landlord Capital Properties.

It had 54 per cent of Capital yesterday, having crossed the 50 per cent threshold to transform itself into a $1 billion-plus landlord.

AMP is seeking 100 per cent of Capital Properties in its $1.48-a-share bid.

But ABN Amro analyst Mark Lister has raised doubts about AMP succeeding in a full takeover.

He predicted it would fall well short of the 90 per cent compulsory acquisition threshold, leaving it in a difficult position.

Lister said he expected AMP to extend the closing date of its offer - which is due to end today - in an attempt to mop up the rest of the company.

But AMP portfolio general manager Stephen Costley said he was confident the company could get full control - although no decision had yet been made to extend the deadline for the takeover.

"It depends on how strong the postman is and whether he can drag the bags in," a highly confident Costley said.

A flood of last-minute acceptances from retail investors - which Costley referred to as "the Mr Joneses and Mr Smiths" - pushed AMP over the 50 per cent, across the threshold which triggered the full offer.

Other analysts predicted this week's success would not spark any immediate offer-date extensions. AMP was likely to undertake its much-promised review of Capital and appoint new board members, one analyst said.

"Now they have their foot in the door, AMP will do what it's promised and that might not be to stay focused on the office sector but to invest in more retail property," another broker predicted.

ABN's Lister has recommended against investors accepting, saying $1.48 was too low and pointing to Capital's attractions as the only listed real estate vehicle specialising in the blue-chip Government property sector.

Capital's independent directors are also recommending against the offer, found by independent appraisers Deloittes to be "not fair" to shareholders.

Capital was likely to remain a listed entity because of the large number of retail shareholders who were attracted to the landlord's stable returns and good dividends, Lister said.

Unknown yet is the decision of ING senior investment manager Shane Solly who controls more than 3 per cent of Capital, one of the single largest blocks.

"We will be showing our hand in CNZ over the next few days," Solly told the the Herald on Monday.

Costley is threatening a "rigorous review of the existing assets, operations, policies - including distribution policies - and capital structure of Capital".

Rich assets

* With control of Capital, AMP Property Portfolio's assets now include:

* More than $1 billion of property in the office and retail sector.

* More than $500 million of shopping centres, including half of Botany Town Centre, Lynnmall Shopping Centre and Manukau Supa Centa.

* Control over Capital's $585.6 million real estate assets.