The CFS Retail Property Trust Group is poised to unveil its long-awaited deal to spin off from the Commonwealth Bank of Australia and forge a path as the owner of $8.7 billion of Australia's shopping centres.
The play is expected to be announced today and will test the support of billionaire shareholder John Gandel, who co-owns Melbourne's $3.2 billion Chadstone Shopping Centre with the fund.
While last-minute haggling over the retail platform's price is expected among bankers from UBS, Goldman Sachs and Macquarie Capital, $550 million has been tipped, with any equity raising to pay for the rights likely to include the advisers.
UBS is advising the independent directors of CFS Retail, the Commonwealth Bank is advised by Goldman Sachs, and Macquarie Capital is assisting the Gandel Group, which was understood to have been made a formal offer by the bank this month.
The bank's resolve to offload the retail platform became apparent when the independent directors of CFS Retail, Nancy Milne, James Kropp and Richard Haddock, joined the board of the new Centre Retail Management, clearing the way for a deal.
CFS Retail fund manager Michael Gorman and the head of Colonial First State Global Asset Management's property unit, Angus McNaughton, are also tipped to join. Critically, Gandel is expected to have board representation, as he will have significant sway over the trust.
A kicker for the new trust's earnings could be its wholesale property funds business, which expand now uncertainty about the ownership has been resolved.
The bank appears determined to play a role in selecting a suitor for the sister office landlord, the Commonwealth Property Office Fund, as it last Friday struck a deal to sell that trust's management for $41 million to Dexus Property Group.
A twice sweetened bid from Dexus and partner Canada Pension Plan Investment Board is ahead of a rival play by GPT Group but that group is maintaining a tough stance in the face of threats that the bank may buy key properties out of the target fund. Most expect a carve-up of the $3.7 billion office towers portfolio.