The Directors unanimously recommend that you ACCEPT the Offer, in the absence of a Superior Proposal. The reasons for this recommendation are set out below. Further detail regarding the Directors recommendations is provided in the Target’s Statement, which you are encouraged to read.
The Offer Price of $1.20 cash per Propertylink Security represents a significant premium to trading prices of Propertylink Securities across various periods to 20 September 2018, which was the last trading day prior to the announcement of the Initial Offer. The Offer Price also represents a compelling premium to Propertylink’s stated and pro forma 30 June 2018 NTA per Propertylink Security.
The Directors appointed KPMG Corporate Finance as Independent Expert to assess the Offer. The Independent Expert has concluded that the Offer is fair and reasonable to Propertylink Securityholders not Associated with ESR in the absence of a Superior Proposal.
The Independent Expert’s Report is included in the Target’s Statement.
The Offer represents an opportunity for Propertylink Securityholders to receive fair value and certain cash proceeds for their investment, providing certain value and liquidity.
Propertylink Securityholders who accept the offer will not incur any brokerage on the sale of your Propertylink Securities.
As at the date of the Target’s Statement, Propertylink has not received any Competing Proposal from a third party, nor have any discussions occurred that the Directors believe are likely to lead to any Superior Proposal being made.
Were Propertylink to receive a Competing Proposal, the Directors would need to consider all aspects of the proposal in determining whether it is superior to the ESR Offer.
Propertylink’s Security price closed at $1.05 per Propertylink Security on the last trading date prior to announcement of the Initial Offer, being 20 September 2018. Given the premium ESR is offering, Propertylink Securities may trade below current levels if the Offer lapses and no Superior Proposal emerges.
The Offer has a minimum acceptance condition of 50.1%. If ESR acquires between 50.1% and 90% of Propertylink Securities pursuant to the Offer, Propertylink Securityholders will become minority securityholders in a Propertylink controlled by ESR.
There are a number of risks associated with being a minority Propertylink Securityholder including reduced liquidity, loss of premium for control, ESR control of Propertylink, potential reduced distributions, potential delisting and destapling, potential loss of tax benefits in respect of capital losses, potential loss of managed investment trust status for tax purposes and change of control provisions.
Having carefully considered the terms of the Offer against available strategic alternatives, the Directors unanimously recommend that you ACCEPT the Offer, in the absence of a Superior Proposal.
If you have further questions in relation to the Offer, you can call the Propertylink Securityholder Information Line on 1300 889 468 (within Australia) or +61 2 8022 7954 (outside Australia) during the hours of 9:00am and 5:30pm (Sydney time), Monday to Friday (excluding national public holidays).