Aspen Group has scared off a potential suitor for its $210 million Aspen Parks Property Fund, placing a September 29 deadline on retirement village manager Ingenia Communities Group to finalise a binding unconditional offer.
The developer and fund manager said in its annual results last week that it had been approached by Ingenia in June to acquire its 12.5 per cent stake in the fund at its net asset value of $26 million, as well as its management rights for an additional $5 million.
That proposal was swiftly rejected, but in early August Ingenia made another confidential, non-binding bid to acquire all the shares in the Aspen Parks fund, which owns 21 lifestyle parks across Australia, in an all-scrip deal.
Ingenia said last month it believed the Aspen Parks assets would be complementary to its own portfolio, with the majority located near its existing assets in NSW, Victoria and Western Australia.
The fund has been operating since 2004, and includes the Woodman Point Holiday Park, the Ningaloo Reef Resort, and the Monkey Mia Dolphin Resort, among a diverse range of assets.
The Cooke Point Holiday Park in Port Hedland is one of 21 properties held by the Aspen Parks Property Fund.
Aspen said at the time it would investigate the offer to determine if it would provide value to shareholders.
However, Ingenia this week said it had withdrawn from the process, because Aspen had declared an end of the month deadline to produce a binding, unconditional proposal.
“Ingenia has acquired 15 parks over the last 18 months and has a prudent due diligence process that it undertakes in any asset purchase,” the company said in a statement to the ASX.
“This includes legal, planning approvals, site visits, engineering, valuations and human resources.
“The proposed timetable does not provide adequate time to complete a prudent level of due diligence and therefore Ingenia is announcing its withdrawal from the process.”
Meanwhile, Aspen launched plans last week to recapitalise the fund through a $39 million, one-for-two entitlements offer at an issue price of 49 cents.
Aspen said the funds raised through the offer would be used to initially reduce debt, but also to enhance the chances of expanding the portfolio.
Since June 30 2013, the value of the portfolio declined by $63.5 million, with the total assets valued at $210 million at the end of FY2013-14.
Ingenia maintained that its bid would be more compelling to Aspen Parks Property Fund shareholders than the proposed entitlement offer.
“Ingenia remains interested in working with Aspen to explore alternatives,” the company said.
At close of trade today, Aspen shares were down 2.3 per cent, trading at $1.24.
