Frasers Centrepoint’s $2.6 billion takeover of Australand hangs in the balance, with speculation mounting that Stockland might be waiting in the wings with a revised offer for the company if Frasers can’t get its deal over the line.
Hedge funds stacking the Australand register — including a fund linked to the Myer family-backed OC Capital and New York hedge fund specialist Millennium Management — appeared yesterday to still be holding out for a higher deal.
A hedge fund managed by Pacific Alliance Group has also popped up on Australand’s register as a significant shareholder, raising eyebrows and pulses in the investment banking community. PAG was previously reported to have shown an interest in taking over the company in March, ahead of both Stockland and Frasers making their respective offers.
The speculation of Stockland returning with a new offer for Australand comes as acceptances for Frasers’ bid remain a still anaemic 8.9 per cent. Last week Frasers declared its $4.48-a-share cash offer for Australand final, declining to extend the offer of 50.1 per cent if shareholders did not accept the deal by this Thursday.
Frasers yesterday again urged investors to accept the offer.
A failed tilt by Frasers will be seen as a loss of face for the company that has the backing the support of one of Thailand’s richest men, Chang Beer baron Charoen Sirivadhanabhakdi.
Stockland owns 19.9 per cent of Australand and had made a scrip-and-cash bid valuing the company at $2.6bn based on its share price yesterday.
As to what will happen over the next couple of days, one scenario is that Stockland will fold at the last minute after the hedge funds accept the offer. Another would see Stockland make a revised offer ahead of the Frasers deal lapsing this week.
Stockland, which has declined to comment, has the capacity to pay up to $4.65 per share for Australand, according to analysts at CLSA.