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GPT Unitholders to Vote on Internalisation Proposal and Joint Venture with Babcock & Brown

Strategic Insights

— 2 min read

A proposal by General Property Trust (GPT) to internalise the management of the trust, with a new company owned by GPT unitholders, is set to go to a unitholder vote on June 2. The move, which is seen as being in the best interests of unitholders, would also involve a joint venture with global investment firm Babcock & Brown to create a $A1 billion property investment vehicle.

The joint venture, which would see Babcock & Brown and GPT establish a European property portfolio, is seen as a key driver of growth and new opportunities for GPT. GPT chairman Peter Joseph has stated that the internalisation proposal would create a more independent and dynamic GPT, with its own management focused exclusively on the interests of unitholders.

The proposal is also seen as a way to reduce the threat of GPT receiving unsolicited takeover offers in the future, following a failed merger proposal with Lend Lease last year.

Key Takeaways:

  • The General Property Trust (GPT) has proposed internalising the management of the trust with a new company owned by GPT unitholders.
  • The move is seen as being in the best interests of unitholders, with Grant Samuel stating that unitholders are likely to be better off after the restructuring.
  • A joint venture with Babcock & Brown would create a $A1 billion property investment vehicle, with a European property portfolio.
  • The joint venture would provide immediate growth and new opportunities for GPT, and is seen as a key driver of the trust's competitiveness.
  • The proposal would also reduce the threat of GPT receiving unsolicited takeover offers in the future.
  • GPT chairman Peter Joseph has stated that the internalisation proposal would create a more independent and dynamic GPT.
  • GPT independent directors, including Matthew Latham and Ken Moss, have unanimously recommended that unitholders vote in favour of the proposal.
  • Unitholders will vote on the proposal at a meeting on June 2.

Statistics:

  • The joint venture would create a $A1 billion ($US778.3 million) property investment vehicle.
  • GPT units are trading at $3.71, up one cent.
  • Babcock & Brown is trading at $9.40, up eight cents.
  • The joint venture would establish an European property portfolio.
  • GPT's recommendation of a merger with Lend Lease last year was upset by an unsolicited takeover bid by Stockland Group.

Sources:

  • Asia Pulse - Independent expert Grant Samuel
  • Australia Securities Exchange (ASX) - General Property Trust (GPT) ASX:GPT
  • ASX - Lend Lease Corp (ASX:LLC)
  • ASX - Babcock & Brown (ASX:BNB)
  • Westfield Group
  • Stockland Group

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