Ho Bee Land Enters Bidding War for AVJennings with A$391 Million Offer

Singapore-based developer Ho Bee Land has launched a takeover bid for Australian homebuilder AVJennings. They are offering A$391 million. This move challenges an existing bid from American real estate firm Proprium Capital Partners. It sets the stage for a competitive acquisition battle.

Ho Bee Land’s Strategic Move to Acquire AVJennings

HBL already holds a 5.5% stake in AVJennings. They have proposed to purchase the remaining shares at A$0.70 per share. This surpasses Proprium’s offer of A$0.67 per share.

Ho Bee Land’s Chairman and founder, Chua Thian Poh, sees the acquisition as a strategic move. “The proposed transaction represents a good opportunity for the group to enhance its scale and capabilities in Australia,” Mr. Chua stated.

Impact on AVJennings’ Stock Price

Following the announcement of Ho Bee Land’s bid, AVJennings’ stock price jumped 7.8% to A$0.69. However, it remains below the company’s net asset value of A$0.81 per share. The acquisition target is attractive due to AVJennings’ substantial land bank. This land bank has the potential for approximately 10,000 new homes when fully developed.

AVJennings’ Response and Ongoing Discussions

AVJennings has acknowledged the bid. They remain in discussions with Proprium and AVID Property Group. Exclusivity and access arrangements are in place until January 31. The company has granted Ho Bee Land due diligence access, subject to confidentiality arrangements. “Following receipt of advice from AVJennings’ financial and legal advisors, the board of AVJennings has concluded the fiduciary exception applies to the Ho Bee Land proposal,” the company stated.

The bidding war between the two companies for AVJennings highlights the competitive nature of the real estate market.   Investors and stakeholders will be closely monitoring the developments in this high-stakes acquisition battle.

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