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24 Split Island Close, Newcastle, NSW. Source: Irongate
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  • Irongate Group (IAP) rejects revised non-binding indicative takeover proposal from 360 Capital Group (TPG) and 360 Capital REIT (TOT)
  • The proposal was for 360 Capital Group through an agreed trust scheme, to acquire all stapled securities in IAP that it does not already own for A$1.65471 cash per share
  • The revised indicative proposal is a 3.1 per cent increase over the first indicative proposal of October 15, 2021, with no modifications to its conditional parameters
  • IAP board has unanimously decided that the proposal continues to substantially undervalue IAP and so does not constitute a compelling proposition for securityholders
  • Shares in IAP are up 1.25 per cent to $1.62; TGP is up 0.89 per cent at 84.8 cents, and TOT is trading 0.55 per cent higher at 91 cents

Irongate Group (IAP) has rejected the revised non-binding indicative takeover proposal from 360 Capital Group (TPG) and 360 Capital REIT (TOT).

The proposal was for 360 Capital Group through an agreed trust scheme, to acquire all stapled securities in IAP that 360 Capital does not already own for A$1.65471 cash per stapled security, being a headline price of $1.70 less than the announced distribution of $0.0453 per stapled security for the half year ended September 30, 2021.

The revised indicative proposal is a 3.1 per cent increase over the first indicative proposal of October 15, 2021, with no modifications to its conditional parameters.

IAP rejected the original proposal as it claimed the deal undervalued IAP and did not present a compelling proposition for shareholders.

After consulting with its advisers, the IAP board unanimously decided that the proposal continues to substantially undervalue IAP and so does not constitute a compelling proposition for securityholders.

Following revaluations, IAP said that its net asset value has improved to $1.61 per stapled security as of September 30, 2021.

The original proposal proposed 360 Capital to acquire all the stapled securities in IAP which 360 Capital does not already own for $1.6047 cash, a 10 per cent premium on the last closing price at the time.

360 Financial’s internal capital resources were yet to be identified and are subject to approval, while conditional uncommitted third-party funding sources include ESR Australia and Citibank.

In addition to the aforementioned condition with ESR, the transaction is conditional on Citibank establishing new loan facilities, for which 360 Capital has secured a very conditional non-binding letter of support from Citi for debt arranging and underwriting.

The plan also requires JSE, FIRB, and other regulatory clearances, in addition to the IAP board’s unanimous support.

The indicative proposal was also conditional on one or more of ESR Real Estate’s or its affiliate’s managed funds entering into an agreement with 360 Capital to purchase an undefined number of selected assets from IAP’s portfolio on terms to be negotiated.

Shares in IAP were up 1.25 per cent to $1.62; TGP was up 0.89 per cent at 84.8 cents, and TOT was trading 0.55 per cent higher at 91 cents at 12:25 pm AEDT.

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