This article is from the Australian Property Journal archive
CIMIC has made an offer on the remainder of Devine Group for $15.6 million, causing the beleaguered developer’s share price to double.
Upon announcing the proposed takeover, Devine’s share price jumped from 12 cents to 24 before peaking on Tuesday at 25 cents, ending the day with a 95.83% increase.
Building construction company CIMIC has made a cash offer for the residential development group at 24 cents per share, having last made a go at fully acquiring the company at 75 cents a share in 2015.
Currently, CIMIC holds a 59.11% interest in the company, after previously shutting down rival bids at buying out the company.
CIMIC would acquire the shares in an off-market takeover through CIMIC Residential Investments Pty Limited, under the condition that at the end of the period it has received valid acceptances in respect of at least 75% of the non-associated shares and a relevant interest in at least 90% of the ordinary shares on issue.
Devine has not managed to return to its peak performance in 2007 where share prices reached $5.03.
Devine’s FY2020 results saw them reporting a total loss after tax of $4.4 million, while in the six months to June 2020 a loss of $3.3 million was posted.
These results, though amidst a broadly challenging year with the global pandemic are virtually unchanged from the six months to June 2019 results. Which at a loss of $3.4 million were a an improvement on the previous corresponding periods $11.4 million loss.
Results have followed a similar pattern of loss over the past decade, with Devine posting a loss of $85 million for HY18 after failing to recover since a fall of 43% in HY12.
Devine has since this fall been securing extensions to debt facilities, such as the multi-option facility with ANZ for $70 million in 2018, which was set to expire in April of last year.
This after previously being granted a one year extension from March 31 2017 to March 31 2018 on this debt, the developers had drawn a debt of $56 million with ANZ in December of 2015, after receiving extensions from ANZ since 2013.
Devine did make a move to buy in on the Gold Coast’s slew of successful luxury apartment developments in Gold Coast in April of this year, unveiling a $105 million plan for a project in Burleigh Heads, Alba Residences.
Devine directors have recommended that shareholders take no action in response to the proposal at this time and are seeking an independent expert report to evaluate whether the report is fair and reasonable.
