This article is from the Australian Property Journal archive
PRIVATE equity giant Blackstone has made a $207 million takeover bid for cash strapped Valad Property Group, sending its share price soaring 51.5% or $0.5950 cents to $1.75 last Friday.
Blackstone has proposed to buyout Valad for $1.80 per stapled security, which represents a 56% premium over the April 27 closing price of $1.155 and is 52% higher than the three month volume weighted average price to April 27.
The proposed bid values Valad at approximately $207 million and will allow shareholders to unlock their investment at a higher price ending their tumultuous journey with Valad.
The price offered is above Valad’s 52-week high price of $1.76 but remains below Valad’s peak trading price of approximately of $2.30 in May and June 2007.
Fast forward 12 months to June 2008, Valad shares were free falling, and trading at a low of $0.50 cents after it revealing writedowns across its business. By August, the company’s shares were trading at around $0.30 cents after it posted a $248 million loss result.
And in December 2008, analysts Citi Investment Research slashed its price target for Valad from $0.46 cents to just 5 cents.
Recently Peter Hurley resigned as the CEO of Valad following his unsuccessful bid for Valad’s European business, which has $6.4 billion of assets under management.
Valad’s chairman Trevor Gerber said the board considers the bid provides the most certain value proposition for all securityholders
“The Valad board has been considering a range of strategic options to maximise securityholder value, including maintaining the status quo, a recapitalisation via an equity raising, a series of select asset sales and an orderly wind up,” he added.
Valad has over $8 billion in assets under management globally but has struggled with debt as well lower its gearing, which is at 51.3% as of December 31 2010.
This deal comes two months after Blackstone bought Centro’s US assets for $9.4 billion.
Australian Property Journal
