Irongate, previously known as Investec Australia Property Fund, has rejected a new A$1.1bn (R12.35bn) offer from fund manager 360 Capital, saying a 3.1% bump in its offer price is still not enough.
Irongate had already rejected an earlier offer from 360 Capital in October of A$1.65 per security, which was unsolicited and had numerous conditions, including unanimous support from the Irongate board. 360 Capital holds about a fifth of the Australian-focused property group.
The new offer of A$1.70, less an announced distribution for Irongate’s half-year to end-September, represents a 13.3% premium to the group’s share price before the first offer was announced in mid-October.
Irongate said on Friday its board had unanimously rejected the new offer as it continues to undervalue it.
At end-September, Irongate had a portfolio of 36 properties, valued at A$1.425bn, and its net asset value per security had risen 8.4% to A$1.55 from end-March.
Irongate said in October the offer did not reflect underlying value in terms of its office and industrial real estate portfolio, value-add upside potential embedded in the portfolio, and the value and growth potential of its third-party funds management business.
360 Capital said in a statement on Friday that it was disappointed with the rejection. It said it was surprised that the board had taken its decision without giving security holders time to consider the new offer.
Irongate was listed by the Investec group on the JSE in 2013 and on the ASX in 2019.
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