This article is from the Australian Property Journal archive
ALIRO Group, headed by Charter Hall co-founder David Southon, is a step closer acquiring Australian Unity Office Fund (AOF) in a $403 million deal, entering into a confidentiality agreement and due diligence with the takeover target.
An independent board committee comprising independent directors of AOF’s responsible entity currently intends to unanimously recommend that AOF shareholders vote in favour of the proposal. AOF’s largest shareholder, Hume Partners Pty Ltd, has already stated it will use its 19.97% stake to back the deal.
Aliro late last month made its all-cash, non-binding indicative proposal to acquire all issued AOF units for $2.45, a 11.9% premium to the previous close.
AOF shareholders would still be able to receive a 3.8c per unit distribution for the June half, and of up to 1.5c per unit for the September quarter, and 0.5c per unit for each month after September until the trust scheme is effective.
It comes a few months after AOF’s plans to merge with Australian Unity Diversified Property Fund were knocked back by investors, scuppering the creation of a $1.1 billion portfolio. Shareholders had also thwarted a takeover bid from Charter Hall and Abacus Property Group in late 2019.
AOF had in recent months that it was having discussions with suitors and that it was set to appoint agents to solicit sale proposals for its then-$586 million portfolio of metropolitan and CBD office buildings.
Earlier this month, AOF announced that Property NSW would not renew its lease as the major tenant of the fund’s 10 Valentine Avenue building in Parramatta, resulting in nearly $29 million wiped off its value to $120.55 million. That brought down its net tangible asset value from the $2.67 reported in February to about $2.50.
Southon co-founded Aliro Group along with Daniel Wise in 2017. In recent months it has bought industrial sites in western Sydney’s Chipping Norton for $60.5 million and Geebung in Brisbane’s north for $67.75 million, while it has created a build-to-rent platform alongside former Mirvac executives.
