Analysts continue to watch for developments at GPT regarding a firm offer for Australand. The talks continue to centre on whether GPT can find a buyer for Australand's residential assets, with a number of Asian-based investors said to be interested in the business.
GPT waded into the fray in December with an indicative non-binding offer for Australand's commercial and industrial assets, which was rejected.
Although no price was made public, Australand's directors said the "indicative" value proffered by GPT was too low.
The concern was that Australand would be left with its business at a time when the housing market is under pressure.
Analysts have now said that with Australand's major shareholder, CapitaLand, a seller of its stake, another bid could be in the wings from GPT in a joint venture deal.
Possibly an Asian investor would buy the housing business, leaving GPT with the office and retail assets.
According to John Kim of CLSA, a total acquisition price for Australand's investment property and commercial and industrial portfolio would be about $2.9 billion (including transaction costs of about $96 million), representing about a 5 per cent premium to estimate of book value of $2.6 billion.
The bid would likely be 100 per cent cash, but would be funded with about 65 per cent in equity through a raising and the rest in debt. "We believe it would be unlikely for GPT to pay a premium greater than 10 per cent."