ING launches full takeover of Calan Healthcare
ING Property Trust launches full takeover of Calan Healthcare
ING Property Trust Investments Limited (ING Property Investments), a company that is wholly owned by ING Property Trust, said today that it intends making a full takeover offer for all the units in Calan Healthcare Properties Limited (Calan) that it does not already own.
The offer to Calan unit holders is for:
• 0.528 units of ING (equivalent to 0.62c per Calan unit); and • 0.63c in cash for each unit of Calan.
This cash & scrip offer is equivalent to a current unit price for Calan of $1.25.
The cash component will be adjusted for any future dividends paid by Calan, including the dividend announced last week.
The offer is expected to open by the end of February and is scheduled to be open for eight weeks. It is conditional on 75% acceptances being received.
ING Property Investments also advises that its market stand at $1.25 per unit will close at 5pm on Wednesday 1 February 2005 (unless extended by ING). To date Calan unitholders have sold 4.858 million units, equating to 3.5% of Calan units on issue. Those who have tendered their units into the stand receive $1.25 in cash and have the protection of an escalation clause in the event that ING Property Investments increases the consideration payable in its offer to Calan unitholders beyond $1.25 per unit (based on the closing ING Property Trust unit price on the day prior to announcement of the increase). Calan unitholders wishing to take advantage of the all cash consideration, early settlement and escalation provisions of the stand should do so now. The stand has no conditions.
ING (NZ) Limited, a separate entity, already holds on behalf of third party clients approximately 10.2% of Calan through its managed funds operation. The
NZX has ruled that ING (NZ) Limited is an associated party of ING Property Investments as a result of common ownership of the manager of ING Property Trust. Coupled with the holding of ING (NZ) Limited, the combined holding is 13.7%.
The chairman of ING Property Trust, Mike Smith, said that he was encouraged by the feedback from investors during the stand and believed that this augured well for the takeover.
“We have had constructive initial discussions with the Calan board and management and we look forward to having further talks with both the board and management of Calan as we seek support for our offer.
“We believe that our offer is fair and reasonable to all Calan unit holders.” ING Property Investments offer represents:
• a premium to the highest price at which Calan units have ever traded on the market prior to the stand on 25 January 2006;
• a 9% premium to the price at which Calan units closed immediately preceding the announcement of ING Property Investments market stand; • a 16% premium to the volume weighted average price at which Calan units have traded on NZX over the last 12 months; • a 14% premium to the consensus valuation of $1.10 a unit based on the research published prior to ING’s announcement of the market stand by the four NZX brokers who report on Calan; and • a premium to Calan’s recently revalued net tangible assets per unit.
The managing director of ING Property Trust Management Limited, Andrew Evans, said that the rationale for undertaking the takeover was simple. “Growth and consolidation of the listed property securities market demands that listed entities have the size and scale to compete for assets, tenants and opportunities to preserve the interest of investors. “Absence of growth means that unit price appreciation is limited, and this has been a difficulty for Calan since listing “ING Property Trust has a successful track record of value accretive growth of its portfolio through adding value to existing properties, organic growth and through acquisitions – the most recent transaction being the successful takeover last year of Urbus Properties Limited.
ING Property Trust is committed to a disciplined approach to acquisitions and healthcare is a growing sector with attractive fundamentals that is under represented in our portfolio, hence our interest in this investment.” Mr Evans added that the purchase of Urbus provided a good example of what value could be added. Former Urbus unit holders have benefited from the continued strong performance of ING Property Trust’s unit price, and higher distributions, since accepting the ING offer last year.” “We think that Calan unit holders will get a better rate of return from being part of a larger more liquid company, whilst adding value for our own unit-holders”