FKP Property Group climbed to the highest in two years in Sydney trading on speculation Stockland, its second-biggest shareholder, may seek to acquire the real- estate company after selling out of rival GPT Group today.
FKP shares rose 1.6 percent to 93.5 Australian cents at the close of trading in Sydney, the highest since October 2008. The shares earlier surged as much as 8.2 percent.
Stockland is comfortable with its current 14.9 percent stake in FKP, spokeswoman Katie Lennon said. FKP spokesman Brett Zarb declined to comment.
With Stockland’s focus on retirement, residential communities and retail assets, “it’s not a long shot to conclude they’re about to have a go at the rest of FKP,” said Will Seddon, who helps oversee A$350 million ($342 million) at White Funds Management in Sydney.
Stockland, Australia’s biggest diversified property group, today said it was selling its 13.1 percent stake in GPT, held in a derivative structure, at a A$208 million loss. The company, which last month won agreement to its A$320 million takeover bid for Aevum Ltd., now owns 83 percent of the Sydney-based retirement village operator, according to Bloomberg data.
FKP’s retirement assets would be valued at about A$1.15 a share if the price Stockland paid for Aevum was applied to them, Goldman Sachs Group Inc. real estate analyst Peter Zuk wrote in a note dated Sept. 21. FKP’s current price offers a buying opportunity, said Winston Sammut, managing director of Maxim Asset Management.
FKP’s share gain “was sparked by Stockland’s move,” said Sammut. “Stockland had three strategic stakes, and its only remaining stake now is FKP.”
Stockland shares fell 0.8 percent to end the day at A$3.75 in Sydney, while GPT shares closed down 0.7 percent at A$2.83.