Ingenia Communities Group said on Monday that it has received a takeover proposal from AVID Property Group Holdings valuing the company at 2.2 billion Australian dollars, about 1.54 billion US dollars. AVID, which is owned by Proprium Capital Partners, offered 5.40 Australian dollars for each Ingenia share, a 13.4 percent premium to Friday’s closing price. Ingenia’s shares rose as much as 9.1 percent on Monday to their highest close in nine months, ending up 5 percent at 5 dollars.
The bid interrupts a live process. Ingenia had already received three rounds of bids from Warburg Pincus, the latest at 5.25 dollars a share, and had set an October 23 deadline to sign a process deed with the US firm. Instead, the board has entered a process deed with AVID, given it soft exclusivity for up to six weeks, and terminated Warburg Pincus’s access to the data room.
AVID’s offer is backed by an unnamed global sovereign wealth fund and a global financial sponsor, Ingenia said, and it hinges on Ingenia terminating its planned 992.5 million Australian dollar acquisition of Peet, announced in late August. Ingenia develops and operates land lease communities, rental and holiday accommodation, a segment where listed values have lagged the cash flows, which is part of the contest: analysts quoted by Reuters attributed the shares’ discount to the Peet deal terms and to weak sentiment toward residential real estate after Reserve Bank rate rises, and noted the stock had already risen more than 35 percent since Warburg Pincus’s first offer in September.