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Review heralds major change in company focus

Thursday 05 January 2006

CNZ Business Review heralds major change in company focus – further reason for remaining shareholders to sell

AMP Property Portfolio Investments Limited today noted the announcement of the Business Review undertaken by the Capital Properties New Zealand Limited Board, which will bring a change in direction for Capital Properties from a yield investment to a growth investment. Remaining shareholders should now consider the ramifications of these changes in terms of their investment objectives.

The Board has indicated that Capital Properties’ future dividend payout will be six monthly with a payout ratio of between 40 and 60% of net earnings, (down from the previous practice of close to 100%), subject to review on a six monthly basis taking into consideration growth opportunities, retained earnings and earnings outlook. The Board has also indicated that no dividends or dividend forecast will be considered or provided while the Takeover Offer from

AMP Property Portfolio Investments Limited remains open. Murray Gribben, the chairman of Capital Properties said in a statement to the NZX that “…with a number of potentially significant developments coming up over the next three to five years it makes sense to retain a portion of our earnings to assist in the funding of these opportunities”.

“For remaining Capital Properties shareholders, this change represents a possible halving of forecast yield and is a further reason to accept AMP Property Portfolio’s offer of $1.48 cash per share and invest in better yielding entities,” said Stephen Costley, General Manager, AMP Property Portfolio. AMP Property Portfolio has received further acceptances and now holds or controls almost 85% of Capital Properties’ voting rights. “The Offer will remain open until 13 January, giving remaining shareholders an opportunity to realise a fair and full return on their investment now. Our view remains that shareholders will receive a higher value outcome if they sell their shares in Capital Properties, than if they hold them.”

“Accepting now will also ensure that shareholders get paid within seven days of their acceptance being received. We are confident that AMP Property Portfolio’s Offer will reach the 90% threshold required for compulsory acquisition. In this case, the acquisition of shares held by non-accepting shareholders will be subject to a different process and payment could take significantly longer,” said Mr Costley.

The Offer will close at 11.59pm on Friday 13 January 2006 (subject to any extension in accordance with the Takeovers Code).


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