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Revised IOF-DEXUS merger receives mixed response from stakeholders

Aftera sweetened bid, theproposed merger of DEXUS PropertyGroup and , or IOF, seems tohave won the support of one of the latter's major shareholders, but is yet toget the same from the owner of its manager.

The Australian reported April 7 that CBREClarion and RREEF followed DEXUS' move in asking Australia's Takeovers Panel toprevent Morgan Stanley Real Estate Investing from voting on the merger. The twofirms believe that a negative result concerning the merger may financiallybenefit Morgan Stanley.

DEXUSasked the panel inMarch to have Morgan Stanley abstain from voting due to conflict of interest,as previously reported. The panel is yet to rule on the complaint.

Accordingto SNL dataCBRE Clarion Securitiesholds a 10.47% stake in IOF. Morgan Stanley, through Post Sale Portfolio IssuerPty. Ltd., holds an estimated 8.9% stake in IOF. The affiliate obtained courtpermission to vote on the merger.

Onthe other hand, proxy adviser Ownership Matters recently that it will support DEXUS'takeover bid for IOF, thanks to the revised offer.

Meanwhile,Investa Listed Funds Management Ltd. said April 6 that it believes thesweetened offer stillundervalues IOF. It noted that the special cash distribution will not have amaterial effect on the offer.

Investaadded that it seeks to "strengthen and consolidate its relationship"with the listed fund by having IOF acquire 50% of the Investa platform, anoffer that it has previously suggested.

IOFshareholders are scheduledto vote on the merger April 15, as reported earlier.