Charter Hall, Abacus strike takeover deal for Australian Unity Office Fund

Australian property groups Charter Hall and Abacus Property have taken a step closer to their A$495m (US$332m) takeover of the ASX-listed Australian Unity Office Fund after signing a scheme implementation agreement.

The buyers have agreed to acquire all AOF shares that they doesn’t already hold for A$3.04 per stock, less any additional distributions other than its 3.95% distribution announced in June, according to regulatory notices.

The transaction reflects a 9.4% premium to AOF’s closing price on June 3, the day prior to the original offer, and a 9% premium to its net tangible assets per unit value, as of end-June 2019.

The AOF’s independent directors have unanimously backed the deal and recommended shareholders support the transaction.

AOF owns a portfolio of nine offices across metropolitan and CBD markets in Sydney, Adelaide, Melbourne, Brisbane and Canberra, worth a combined $635.6m, as of June 2018.

The takeover bid was first launched in June this year after the partnership acquired a 19.9% stake in the fund.

Charter Hall and Abacus bought its initial stake in AOF for A$95.6m, representing A$2.95 per share.

The consortium initially offered to pay $2.95 per unit to shareholders, but raised its offer in August.

The portfolio has about 105 tenants, reflecting an overall occupancy rate of 95% and a weighted average lease expiry of 4.1 years.

The assets include 10 Valentine Ave in Parramatta, 468 St Kilda Road in Melbourne, 150 Charlotte Street in Brisbane’s CBD and 30 Pirie Street in Adelaide’s CBD.

Abacus Property had A$2.1bn of assets under management, as of end-June 2018.

Charter Hall is an Australian-listed property fund manager, with A$34.6bn of assets under management.

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