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GPT Proposals Counter Takeover Bids

MELBOURNE-The independent directors of General Property Trust propose the company internalize its management--a task currently handled by Lend Lease--and form a joint venture with Australia's second-biggest publicly traded investment bank.

By Brian K. Miller | Updated on February 17, 2005

MELBOURNE-The independent directors of General Property Trust, Australia’s second-biggest real estate trust, are proposing the company be self managed, a task that now earns Lend Lease Corp. A$20 million in fees. In addition, GPT proposes to grow itself through a $1-billion international property and investment and development joint venture with Babcock & Brown Ltd, Australia’s second-biggest publicly traded investment bank. If executed, the proposals would counter attempts by Lend Lease and Stockland Group to win GPT unit holders’ approval to acquire their company. They could also prompt one or both parties to submit new, higher offers for the company.Lend Lease says in a prepared statement that as the owner of the responsible entity for GPT, it supports the company’s review of its alternatives to the current takeover offers by itself and Stockland, but “has reserved its position at this time and will remain an actively interested party as the proposal, and any others that may yet emerge, are assessed by the market.” The statement goes on to say that “there remain many opportunities (for Lend Lease and GPT) to work together, whatever the outcome of the current proposals.”Westfield Group, the world’s largest manager of shopping malls by market value and a 6.5% shareholder of GPT, says it will support the two GPT proposals. Indeed, in a separate transaction, Westfield says it will buy stakes in three General Property centers for A$842.4 million. GPT reportedly will use the proceeds to buy $700 million of preferred stock in the Babcock & Brown joint venture.

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