Commonwealth Bank’s Office Fund Ends Pact on Dexus, CPPIB Bid
Commonwealth Bank of Australia ended an agreement with the Canada Pension Plan Investment Board and Dexus Property Group (DXS) on their A$2.8 billion ($2.6 billion) bid for the bank’s office fund after the consortium failed to match GPT Group’s (GPT) higher offer.
The Commonwealth Property Office Fund’s (CPA) manager ended the agreement, which allowed Dexus exclusive due diligence, as it didn’t match GPT’s competing proposal valued at A$3 billion, it said in a regulatory filing today. Dexus can continue due diligence on a non-exclusive basis, it said.
Today’s announcement allows GPT to begin discussions on the fund as it fights Dexus for control of A$3.8 billion of office buildings in Australia’s biggest cities. Dexus, which in July agreed to buy a 14.9 percent stake in the fund known as CPA said last week it won’t back GPT’s offer.
While Dexus and the Canadian fund are committed to their bid, it’s too soon to respond to GPT’s proposal, Dexus said separately today. The companies have entered into a new confidentiality agreement with CPA’s manager and will continue with due diligence, it said.
CPA shares fell 0.2 percent to A$1.2625 as of 10:53 a.m. in Sydney. Dexus shares rose 0.7 percent to A$1.052, and GPT securities jumped 3 percent to A$3.665, compared with a 0.6 percent gain in the benchmark S&P/ASX 200 index.
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