26/10/2015 - 14:29

$135m bid for Aspen property fund

26/10/2015 - 14:29

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Aspen Group’s battle for ownership of Aspen Parks Property Fund has intensified, after Discovery Holiday Parks put forward a $135 million takeover offer for the business.

$135m bid for Aspen property fund
Aspen Group chief executive Clem Salwin.

Aspen Group’s battle for ownership of Aspen Parks Property Fund has intensified, after Discovery Holiday Parks put forward a $135 million takeover offer for the business.

Discovery put the 58 cents per share bid to Aspen, which as a 42 per cent stake in APPF and is working to wholly acquire the target itself.

In a statement, Aspen said the Discovery offer ‘went some way’ to recognising the value of the unique APPF portfolio.

“At the unsolicited offer price, the value of Aspen’s 42 per cent stake in APPF would increase, resulting in Aspen’s pro-forma net asset value increasing to $1.36 per security, up from $1.26 as at June 30,” Aspen said.

However Aspen generates about $3 million in annual revenue alone from a management contract with APPF and says the contract remains in place until 2019 and has limited termination rights.

It has recommended shareholders vote for the merger between Aspen and APPF.

“Key benefits of the merger include the opportunity for APPF shareholders to remain fully invested in the value-for-money accommodation asset class, and to enjoy the income and capital returns that would come from remaining invested in a sector with positive long term trends,” the company said.

“This continued investment opportunity is not afforded to APPF shareholders under the (Discovery) unsolicited offer.

“Aspen will engage proactively with Discovery and any other potentially interested parties to determine whether an attractive alternate proposal can be developed in relation to Aspen, APPF or both.”

Aspen closed 5.4 per cent lower to $1.39 each.

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