Private equity may be circling the $1.3 billion property arm of listed utilities company UGL, but if the price doesn't measure up to expectations, the demerger proposal may be abandoned.
Some market sources now say that if the deal proceeds, it will leave UGL with a low share price, with the real estate sector likely to lift on the back of an improving global economy.
Angry shareholders lashed out at the company's managing director Richard Leupen at the annual general meeting last year, with accusations the company was a "sinking ship" on the back of a 73 per cent profit dive last financial year.
Profits fell due to weakness in the mining services, where mining companies focused on cost-reduction programs and cancelled projects.
The demerger plans have been on the cards since early last year, with the logic being that they would create more value for shareholders. However, it is understood the spin-off is still a long way down the track.
Rather than scrapping the demerger plan altogether, it could be further delayed, should the business not sell to private equity.
A research note by Deutsche recently pointed to strong results from global real estate rival Jones Lang LaSalle as a positive indicator for UGL's business DTZ.
The company maintains the demerger is going ahead.