DataRoom AM: Westfield temptation

Frank Lowy's Westfield Corporation may soon become a takeover target, while Wotif.com celebrates an attractive offer from Expedia.

Frank Lowy may have won an epic battle over his property empire recently, but in so doing has he set up the newly formed Westfield Corporation as a takeover target?

Elsewhere, Wotif.com falls into the hands of global rival Expedia, the fight over a dividend at Envestra remains unresolved, the bid deadline for SAI Global is delayed and Elders may be ripe for a new takeover offer.

Fresh from securing its standalone future, Westfield Corporation could soon find itself in the sights of buyers. Analysts at Moelis Australia believe Simon Property Group and Taubman Centres could both be interested in making a play before Westfield progresses with plans to list in the US. Simon is likely the most absorbed in the prospect of a deal, reportedly mulling options for a merger.

The analysts suggested a takeover was less likely once the firm moves to dual-listed status, which is likely in the next 12 months.

The speculation comes as M&A activity continues to heat up in Australia, with Wotif.com the latest local firm to draw the interest of a cashed-up suitor. Global online hotel reservations giant Expedia yesterday lobbed a $703m offer the way of the ASX-listed group and the deal is expected to clear given the support of the target’s board and several key shareholders.

Meanwhile, SAI Global has delayed the deadline for suitors to make a rival bid to the recent $1.1bn offer put forward by Pacific Equity Partners. According to The Australian Financial Review, PEP is the only confirmed player for the whole SAI business, but various parties are interested in one of its three main divisions: compliance, standards and assurance. It means the winning bidder could end up being a hastily cobbled together joint venture arrangement.

Offers will be required for submission prior to July 15, nine days later than originally scheduled.

In energy, Envestra is none-the-wiser about plans to push forward a dividend for shareholders that accept the takeover offer from Cheung Kong Infrastructure. The target has appealed to the Takeovers Panel to determine whether a final dividend can be paid on July 11, rather than the August 21 date sought by the suitor. The Panel will decide whether to hear the case this week and offer a verdict within a fortnight should the case move forward.

Elsewhere, Elders is again believed to be in the sights of a number of suitors, with the AFR naming Pacific Equity Partners as one firm to have run the numbers on a takeover offer. Asian investors and live exporter Wellard may also be mulling an offer as Elders’ business shows signs of recovery.

In resources, WA-based graphite miner Lamboo Resources has signed a merger deal with China Sciences Hengda Graphite. The planned agreement will see Lamboo acquire the Chinese outfit in an all-scrip deal that will leave China Sciences with 57 per cent of Lamboo stock.

Offshore, Aristocrat Leisure has sealed a $1.4 billion bid to claim control of US-based Video Gaming Technologies in a deal first mooted last week. The gaming giant said the deal isn’t likely to close until early next year, with funding to come from nearly $1.5bn in new debt facilities and a $375m placement to institutional investors.

In the IPO market, Barrack St Investments is pressing forward with plans to float an investment company focussed on small and mid-cap stocks. The group is looking to raise $50 million and hit ASX boards on August 14. Barrack’s float comes as marketing begins for the $4bn float of Medibank Private, with a three-week roadshow kicking off in Melbourne today, according to the AFR.

Finally, Woolworths SA has released its bidder’s statement for Country Road, as it seeks to seal the backing of Solomon Lew, who controls much of the stock not owned by Woolworths. Any deal is conditional on Woolworths receiving shareholder support to acquire David Jones.