Singapore’s ARA Asset Management has made a takeover bid to acquire a large chunk of securities in Cromwell Property Group that it does not already own.
ARA is already Cromwell’s largest shareholder, with a 24 per cent stake. ARA said it would seek to acquire 29 per cent of the remaining Cromwell stapled securities at 90 cents each.
If successful, the bid will take ARA’s shareholding close to 50 per cent, allowing it to gradually take a majority stake in the Brisbane-based property fund manager.
The price is a 3.4 per cent premium to Cromwell’s 87 cents a security closing price on Monday. By 1208 AEST, Cromwell securities were up 7.5 per cent to 93.5 cents each.
Cromwell called the offer “unsolicited” and “opportunistic” and advised its shareholders to not take any action.
In a letter to Cromwell, ARA said it has become increasingly concerned with the poor operational performance, increased complexity, erratic strategy, and overall governance and risk management protocols.
As Cromwell’s largest security-holder, it has sought to constructively engage with the board on a number of occasions to ensure security holder value is protected and maximised, it said.
It said these attempts have been met with an unwillingness by the Cromwell Board to engage in a constructive manner.
ARA said an increased shareholding will help it drive a refresh of Cromwell’s board.