GLOBAL - A consortium that includes the Canadian Public Sector Pension Investment Board and a subsidiary of Singapore sovereign wealth fund GIC looks set to acquire the Australian Charter Hall Office REIT for AUD$2.49 per unit (鈧�1.96).
In a statement, Roger Davies, chairman of Charter Hall Office Management (CHOLM), which manages the REIT, said the offer represented 鈥渢he most compelling and certain value proposition currently available鈥� to shareholders.
His comments came at the end of negotiations, which resulted in a per-unit increase in the consortium鈥檚 offer to AUD$0.10.
The committee鈥檚 recommendation follows the rejection in October of a Macquarie-led bid for the company as 鈥渘ot adequate鈥�.
To pass, the new proposal will need to be approved by 75% of unit holders at a mid-March meeting ahead of implementation at the end of the month.
The proposal as recommended by Davis鈥檚 committee carries with it a number of get-out options.
Although CHOLM鈥檚 independent director committee has recommended the deal to unit holders, it could still withdraw support in the event of a better offer.
The REIT, which has AUD$1.84bn in domestic assets under management, is in the process of selling US assets it values at $575m (鈧�440.8m) to Beacon Capital Partners.
The proceeds from the US sale will be distributed to unit holders in a bid to sweeten the deal.
Any delay in the US sale process will leave unit holders liable to the acquiring consortium - which also includes Charter Hall Funds Management - for any debts.
However, according to the proposal, it will also provide grounds for CHOLM to call off the deal.
Canada鈥檚 Public Sector Pension Investment Board allocates 13% of its CAD5.3bn (鈧�4bn) portfolio to real estate, though only 15.4% is invested in office.
Its largest sector investment - 28.6% - is in retirement homes.
