Warburg Pincus LLC-backed ESR Real Estate (Australia) Pty. Ltd. sweetened its buyout offer for Australian property company Propertylink to A$1.20 per security in cash from A$1.15 per security.
The revised offer represents a 4.3% increment to ESR's initial proposal price and a 14.3% premium to the closing price of Propertylink securities at Sept. 20.
Once a bid implementation agreement is entered into, Propertylink directors plan to unanimously recommend that the company's security holders accept ESR's takeover bid that is expected to stem from the revised proposal. The acceptance would be subject to an independent expert concluding that the revised offer is fair and reasonable to Propertylink security holders not associated with ESR and in the absence of a superior proposal.
The finalization of the revised proposal, meanwhile, is subject to satisfactory completion of due diligence by ESR, among other things.
ESR said that subject to execution of a binding bid implementation agreement that has not been terminated and Propertylink directors continuing to recommend the revised proposal, ESR plans to vote its 19.9% interest against all of the resolutions proposed by a Centuria Industrial REIT affiliate at a Propertylink extraordinary general meeting requisitioned by Centuria. Centuria, which recently rejected Propertylink's unsolicited A$755 million takeover offer, is proposing to remove all of the current Propertylink directors, other than the managing director, and replace them with six directors nominated by Centuria.
Propertylink retained Goldman Sachs Australia Pty. Ltd. and J.P. Morgan Securities Australia Ltd. as its financial advisers, with Herbert Smith Freehills serving as legal adviser in relation to ESR's revised proposal.