Australand's takeover by Singaporean group Frasers Centrepoint has been declared fair and reasonable by independent expert KPMG.
Frasers, which counts Thailand’s Chang Beer billionaire Charoen Sirivadhanabhakdi as its largest shareholder, is widely expected to succeed with its bid.
The independent expert’s report will be seen as another positive for Frasers’ all-cash offer of $4.48 per share, which values the local residential developer and property investor at $2.6 billion.
KPMG found that Australand’s shares should be valued at between $4.22 and $4.54.
“Directors have recommended security-holders accept the offer in the absence of a superior proposal,” Australand independent chairman Paul Isherwood said in a statement.
Rival suitor Stockland now appears to be well and truly out of the race after its second scrip-and-cash offer for Australand, equivalent to $4.35 per share, was trumped by Frasers early last month.
Stockland, which holds 19.9 per cent of Australand’s shares, has kept its powder dry since being outpaced by Frasers.
Responding to the release of the target’s statement and independent expert’s report yesterday, a Stockland spokeswoman said: “We’ll consider our options and will make further announcements in due course.”
Stockland is expected to reap a profit of $80 million if it sells its stake into the Frasers offer. The offer closes on August 7, unless extended.
Frasers plans to take Australand private once its takeover reaches 90 per cent. Its offer is dependent on securing 50.1 per cent of Australand’s shares.
Frasers has already received approval for its bid from the Foreign Investment Review Board.
Frasers surprised the market in early June with its bid for Australand, the third offer for the local developer in the past three years, following an earlier tilt by GPT and Stockland’s more recent offer.
The flurry of activity was spurred by Australand’s long-time 60 per cent shareholder, Singapore’s CapitaLand, divesting its stake in the company.
Frasers has been building a significant Australian business through its acquisitions of Central Park project in Sydney with its co-investment partner, Japan’s Sekisui House.
It also snared the $200 million-plus Sofitel Wentworth Hotel in Sydney as well as other residential holdings in Sydney.
Australand’s shares closed up 1c at $4.48.