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AMP Capital Investors NZ Ltd has waived its pre-emptive right to buy the units Australian takeover target Ronin Property Trust holds in the AMP NZ Office Trust.

The pre-emptive rights are among numerous pre-emptive clauses in a deed settled when AMP Capital & Ronin became 50% shareholders in AMP Ronin Management Ltd in January.

Multiplex Ltd is most of the way towards succeeding in its takeover offer for Ronin – it had 78.92% on Friday – and will be able to assume ownership of the units plus Ronin’s management role at the AMP office trust.

AMP Capital had previously owned the whole of the management company.

The deed required Ronin to hold no less than 19.9% of AMP NZ Office Trust for 2 years – to 15 January 2006 – and at least 15% after that. If it went below the thresholds it would have to offer the remaining units to AMP Capital.

Given that Multiplex began its bid by acquiring the 15.7% interest of AMP Life Ltd, the pre-emptive rights hardly seemed an issue. Last year it was a different story: AMP Life fought Centro Property Group’s bid for the AMP Shopping Centres Trust in Australia, disclosing after the bid began that it held various pre-emptive rights which it was unwilling to give up.

Centro eventually lost that bid, but got some shopping centres in the wash-up after Westfield Group bought the AMP trust.

Earlier stories:

5 November 2004: Multiplex goes unconditional on Ronin bid  

28 September 2004: NZ assets a major feature of Multiplex bid for Ronin

18 December 2003: Ronin to take most of National Provident’s AMP NZ Office stake, half of trust management

20 May 2003: AMP Life throws another spanner at Centro takeover bid

Multiplex Group’s takeover of Ronin Property Group is well on the way to completion.

Multiplex reported today that it had acceptances for 74.36% of Ronin’s stock.

It also said Standard & Poor’s intended to reclassify Multiplex securities for inclusion in the S&P/ASX 200 property index from tomorrow – Wednesday 17 November.

Multiplex Ltd picked up nearly 12% of Ronin Property Group on Thursday, taking its stake in the AMP property trust to 47.02%.

Multiplex started its bid by acquiring the 15.7% of Ronin still held by AMP Life Ltd and declared its offer unconditional a week ago.

Paladin Australia co-founder Rod Leaver formed Ronin Property Group at the beginning of 2003, and AMP – after losing 3 of its 4 property trusts in takeovers – entered a deal in August 2003 to internalise the AMP Office Trust (Australia)’s management at Ronin, keep AMP Life as a 21% unitholder and take $A29.7 million from Ronin as a procurement fee for the management.

Ronin became a significant player in the New Zealand property market in December 2003, when it agreed to buy the National Provident Fund’s stake in the AMP NZ Office Trust and to join a new management company for that trust with AMP Capital Investors (NZ) Ltd, which previously had 100% management control.

Multiplex, too, has become a significant player in New Zealand, first through its construction activities, more recently by forming a development division and through the launch of an unlisted $265 million New Zealand property fund whose main asset is the ASB Centre in Auckland, a $102.5 million acquisition which the AMP NZ Office Trust had elected not to pursue.

Earlier stories:

5 November 2004: Multiplex goes unconditional on Ronin bid

28 September 2004: NZ assets a major feature of Multiplex bid for Ronin

5 September 2004: Multiplex launches NZ unlisted fund

Multiplex Group declared its takeover bid for Ronin Property Group unconditional on Thursday, when it had 17.46% of Ronin stock.

Multiplex took possession of AMP Life Ltd’s 15.7% holding in Ronin before announcing details of its takeover proposal at the end of September.

The consideration is 0.274 of a Multiplex security plus A8c cash for every Ronin security.

Earlier stories:

28 September 2004: NZ assets a major feature of Multiplex bid for Ronin

25 September 2004: Multiplex talking Ronin takeover

A feature of Multiplex Group’s proposed takeover of Ronin Property Group (containing the former AMP Office Trust in Australia) is that it will take the combined portfolio of the 2 groups in New Zealand over the $A1 billion level.

Multiplex Group took possession of AMP Life Ltd’s 15.7% holding in Ronin Property Group before announcing details on Monday of its takeover proposal.

Multiplex has offered 0.274 new security for every one existing Ronin security, plus A8c cash, worth $A1.33 – a 9.9% premium to the price on 21 September, the day before speculation on Ronin’s future began, and a 17.7% premium to Ronin’s asset backing.

The combined group would have $A5.5 billion of assets, $A1.6 billion debt for 29% gearing. That raises Multiplex’s gearing by 3 points and reduces gearing on the Ronin portfolio from 34%.

Multiplex’s property portfolio would double to $A3.2 billion, comprising 30 assets & 3 investments, and its $A3.7 billion market capitalisation would make it Australia’s 4th largest listed property trust.

The family of Multiplex chairman John Roberts will be diluted from 38% to 27%, and the Hawaiian and Wylie Holdings stakes in multiplex will both fall below 5%.

Ronin holds 30% of the AMP NZ Office Trust plus half of its management company, acquisitions begun in December & completed in January. Multiplex, meanwhile, has just launched its own $A290 million New Zealand property fund.

Ronin asked for the Monday trading halt to be extended because it had received an approach from another party. The trading halt was lifted late on Monday.

But Multiplex isn’t waiting for the competition to gather strength. With 15.7% in its pocket, it said it would go unconditional on 50.1% acceptance.

Trading in Multiplex Group and Ronin Property Trust stock in Australia was halted late on Friday, expected to resume on Tuesday.

Mirvac Group denied it was talking takeover with Ronin on Thursday, while neither Multiplex nor Ronin has made any comment.

The Australian activity has a bearing on property ownership in New Zealand. Ronin bought the National Provident Fund’s 30% stake in the AMP NZ Office Trust last summer, plus 50% of the trust’s management company.

Multiplex, primarily a commercial builder, has had a growing New Zealand presence, setting up a development arm and recently a listed fund holding New Zealand assets.

Mirvac Group managing director Robert Hamilton said today Mirvac “is not currently involved in corporate activity regarding Ronin Property Group.”

He was responding to media speculation that Ronin (which contains Ronin Property Trust, the former AMP Office Trust in Australia) was a takeover target for either Mirvac or Multiplex Ltd.

Despite his denial, Mr Hamilton didn’t rule the idea out. He said Mirvac had a strategy to increase the scale of its property investment & management operations and continued to investigate opportunities.

Neither Multiplex nor Ronin has issued any statement on the speculation.

Ronin’s share price began to rise at the start of August, but has put on A7c to $A1.29 this week.

What happens to Ronin affects investment ownership in New Zealand. Ronin bought the National Provident Fund’s 30% stake in the AMP NZ Office Trust last summer, plus 50% of the trust’s management company.

Panel “manifestly incorrect” in pre-emptive rights ruling

AMP Life Ltd has sought a review of the Australian Takeovers Panel’s orders last week stopping AMP Life from exercising pre-emptive rights over interests held by the AMP Shopping Centre Trust in 5 major Australian shopping centres.

AMP Life said the orders were beyond the powers of the panel, weren’t appropriate & were manifestly incorrect. It said the orders essentially removed, without compensation, its right to have its commercial rights tested in court, unfairly prejudicing the company & its policyholders.

The shopping centre trust is subject to a takeover bid by Centro Properties Group. The takeovers panel ruled that the uncertainty over whether the pre-emptive rights would be triggered if AMP Henderson Global Investors Ltd was removed as responsible entity for the trust constituted “unacceptable circumstances” in relation to the affairs of the trust.

Centro told the panel the commercial effect of the pre-emptive rights would entrench AMP Henderson as responsible entity for the shopping centre trust and deter any takeover bid not acceptable to the wider AMP group.

Centro said this had impaired the efficient, competitive & informed market for control of trust units, contrary to the takeovers regime under the Corporations Law.

The takeovers panel also upheld Centro’s submission that the effect of the pre-emptive rights had not been adequately or effectively disclosed to trust unitholders or the market from 1997 until AMP Henderson made a statement on the Centro bid on 26 March.

The properties subject to the potential pre-emptive rights are Pacific Fair, Macquarie Centre, Garden City Mt Gravatt, Warringah Mall & Garden
City Booragoon, which are co-owned by entities associated with AMP
Life or AMP Wholesale Shopping Centre Trust No 2.

Centro’s offer has been extended to Monday 2 June.

Centro left in the wake

Westfield Trust made an $A1/80/unit cash offer today for the 80.1% of the AMP Shopping Centre Trust it doesn’t already own.
Like Centro Property Group, which also owns 20% of the AMP trust after making the 1st bid for it in March, Westfield doesn’t want AMP Life Ltd to exercise pre-emptive rights arising from interests in 5 of the shopping centre trust’s 9 properties.
But unlike Centro, Westfield said it would sell out of 3 centres, without naming which, to recoup $A500 million.
Westfield’s bid values the AMP trust at $A1.9 billion.
Centro’s current bid, extended to 2 June, offers 3 Centro stapled securities & A27.3c for every 7 AMP trust units, valuing the AMP trust units at $A1.69/unit at Monday’s prices.
Conditions of Westfield’s offer include obtaining a minimum 50.1%, and AMP Life agreeing by 27 May not to exercise any pre-emptive rights if the responsible entity is changed to Westfield Management Ltd.
Centro’s offer has been rejected by AMP interests, but AMP Henderson Global Investors Ltd managing director Jack Ritch welcomed Westfield’s higher offer, at the same price it bought its initial 19.9%. At the start of the year the AMP trust’s price was around $A1.35-1.40.
Westfield director Steven Lowy said the $A1.80 offer would give AMP trust investors a 9.3% premium over the average value of Centro’s offer, a 28.4% premium over the weighted average AMP trust price for the month before the Centro offer, and a 28.6% premium over asset backing.
Mr Lowy said preliminary analysis indicated that, with Westfield in as manager, it could lift the ungeared yield from 6.5% to 7%, and if it didn’t it would rebate management fees from that portfolio until December 2005.
He said the acquisition would be immediately earnings accretive, and expected distribution/unit to rise from 3% to 3.75% for the full 2003 year and 3.75% off the higher base for 2004.
Westfield said it would use debt to buy the portfolio, raising its gearing to 39% before the sale of 3 properties took gearing back to 36%.
Completion of the bid & sales would raise Westfield’s portfolio from 42 to 48 centres worth $A11.5 billion.

Botany, Lynmall & Manukau Supa Centa would be co-managed

Stockland Trust Group launched an unconditional bid on Wednesday for the AMP Diversified Property Trust, which would add $A1.9 billion of assets to Stockland’s $A3 .7 billion to make an $A5.6 billion portfolio.

That portfolio includes 50% of the Botany town centre, which the AMP Property Portfolio sold to the Australian trust last August in a $188.1 million 3-property package. AMP Diversified bought half of Botany for $NZ98.3 million, half of Lynmall for $NZ65.2 million and half of the Manukau Supa Centa for $NZ24.6 million.

The rest of AMP Property Portfolio’s 24 investments is worth $294 million.

The directors of AMP Henderson, as responsible entity, said they intended to recommend Stockland’s bid if no higher offer emerged.

Stockland bought 15% of AMP Diversified in March. In its full bid, it has offered 1 Stockland stapled security plus A80c cash for every 1.9 AMP Diversified units. At Stockland’s weighted average $A5.20/unit, ti said the offer valued AMP Diversified units at $A3.07, representing a 22.8% premium to the March asset backing of $A2.50, and an 18.5% premium over the $A2.59 closing price the day before Stockland’s initial acquisition.

Different deals in Australia & NZ

In Australia, AMP Henderson Global Investors Ltd and AMP Shopping Centres Pty Ltd will sell Stockland the trust, asset & property management businesses currently servicing AMP Diversified.

In New Zealand, Stockland and AMP Henderson (owner the AMP Property Portfolio) will enter into a joint venture to jointly asset manage the 3 properties –and potentially pursue other opportunities.

In Auckland, AMP Property Portfolio general manager Murray Jordan said “it’s sort of business as usual.” He said the joint management model had been used frequently in Australia.

“You have an asset manager each, for each of the interests, then an owners’ committee, 1 representative of each. It seems to work pretty well in Oz.”

Mr Jordan said it was too soon to talk of Stockland’s interest in new opportunities because the 2 parties hadn’t yet entered into any dialogue, but AMP Property Portfolio had experience of joint venturing after doing the Hub at Botany with Willis Bond.

ASB Centre sale to reweight portfolio

AMP Property Portfolio is in the throes of an asset sale on its own account, as the AMP NZ Office Trust does due diligence on buying the ASB Centre on the corner of Albert & Wellesley Sts, for $112 million from the AMP wholesale fund (owner of 40%) and ASB (60%).

The office trust is scheduled to complete due diligence by Friday 13 June for settlement on 31 July.

The deal suits AMP Property Portfolio: “We really want to reduce our weighting in commercial office from 42% to 30%, and selling ASB takes it down to 30%.

“Our real focus then is on enhancing our existing retail centres and looking to acquire industrial & further retail, principally in the greater Auckland area.”

In a separate takeover in Australia, Westfield Holdings Ltd has done the deal to carve up the AMP Shopping Centre Trust. All that remains now is for unitholders of the AMP trust to vote in support.

And AMP Ltd, the deeply troubled parent of these besieged trusts, put a brave face on their departure in a statement outlining the impact if the bids succeed.

Other stories: Westfield does the deals to carve up AMP Shopping Centre Trust

“Impact not material,” says AMP