Ho Bee Land sparks bidding war for Australian property developer AVJennings at A$0.70 a share
The offer trumps an existing deal made by Proprium Capital Partners and Avid Property Group
REAL estate group Ho Bee Land has launched a non-binding indicative offer to acquire all the shares it does not indirectly own in AVJennings for A$0.70 apiece.
This beats an existing offer of A$0.67 a share made by Proprium Capital Partners and Avid Property Group.
In November last year, AVJennings announced that it received an unsolicited, incomplete and non-binding indicative proposal from the two companies, through its investment vehicle PM Nominees C, to buy all outstanding shares by way of a scheme of arrangement.
AVJennings’ chairman Simon Cheong said at the company’s annual general meeting on Nov 28 that Propium Capital and Avid’s proposal would “provide shareholders the opportunity to realise their investment at a price significantly above historical trading levels”.
The offer price of A$0.67 represents a premium of 6.3 per cent above AVJennings’ last traded price of A$0.63 as at 10.59 am on Wednesday (Jan 15). On the other hand, Ho Bee Land’s offer price is a premium of 11.1 per cent above the last trading price.
AVJennings is listed on both the Singapore Exchange and the Australian Stock Exchange.
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On Wednesday, the Australian-based residential property developer said that it will review the Ho Bee Land proposal against the one by Avid.
It added: “Ho Bee Land has also requested a period of initial exclusivity within which to undertake due diligence and negotiate and enter into a scheme implementation agreement.”
The total consideration of the Ho Bee Land deal would amount to about A$390.7 million (S$330.5 million).
Ho Bee Land currently indirectly holds a 5.49 per cent stake in the Australia-based residential property development company.
“The proposed transaction represents a good opportunity for the group to enhance its scale and capabilities in Australia,” said Ho Bee Land in a separate announcement on Wednesday.
It added: “The merged Australian business will have a stronger financial position, increased revenue potential, and enhanced business capability to compete on a national level.”
The proposed deal is subject to the entry into a scheme implementation deed and other definitive documents after negotiations between both companies, among other factors.
Ho Bee Land also noted that the proposed transaction is not expected to have a material impact on the company’s consolidated net tangible assets per share or earnings per share for the financial year ending Dec 31, 2025.
AVJennings also highlighted that there is no certainty that either Avid’s or Ho Bee Land’s proposal would result in a transaction.
The company said that it will make a further announcement regarding Ho Bee Land’s proposal once it has completed its review. It will also update its shareholders of any material developments in relation to the proposals.
Shares of Ho Bee Land were trading flat at S$1.83 as at 10.59 am on Wednesday.
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