4.2b for maple leaf multiplex

$4.2b for maple leaf Multiplex
Email Print Normal font Large font Carolyn Cummins Commercial Property Editor
June 12, 2007


AdvertisementCANADIAN private equity player Brookfield Asset Management is today expected to launch a $4.2 billion cash bid for Multiplex, after yesterday securing the crucial Roberts family's 26 per cent stake.

The offer is to be at $5 per Multiplex stapled security, giving the founding Roberts family a cool $1 billion in return for their controlling interest.

The stock closed before the long weekend at $5.

The Brookfield offer was accepted late yesterday by the Roberts family after it won assurances Brookfield would keep the group intact and "build on its successes".

Brookfield will now use Multiplex as its entry point into Australia, in a move that mirrors the $6.6 billion bid for Investa Property Group by US group Morgan Stanley Real Estate.

In January this year the Roberts family entered into discussions with Brookfield to sell the group. Managing director Andrew Roberts immediately stood down from his role at Multiplex, leaving the group in the hands of chief financial officer Bob McKinnon and chief operating officer Ross McDiven.

Those discussions centred on Brookfield and the Roberts family taking the construction arm while the funds management business would stay in Australia but be externally managed by Brookfield.

The eventual offer was a cash bid for the whole group.

Mr Roberts yesterday declined to comment on the record, and it remained unclear whether he would have any further association with Multiplex.

It was confirmed yesterday that the other parties to undertake due diligence on Multiplex included Investa (now itself a takeover target), Mirvac, and the winner, Brookfield.

Mirvac, which is similar in size to Multiplex, could only afford a scrip and cash bid - a scenario that was rejected by the major shareholder.

There were also suggestions another overseas private equity player was in the wings, but none has entered the data room during the past 5½ months.

It will be the end of an era for the Roberts family. Patriarch, the late John Roberts, founded the group more than 40 years ago in Perth. The group went public in 2003 but endured a maelstrom of criticism over its trouble-plagued Wembley Stadium project in London.

That led to five earnings downgrades mainly during 2005, continued uncertainty in 2006 and a large departure of investors from the group's share register.

It has been said that Multiplex has struggled internally with low staff morale due to the uncertainty over the past five months.

However a spokeswoman said yesterday it was "definitely business as usual".

"Very much so. It has been productive under Bob [McKinnon] and Ross [McDiven] and we have won some good contracts. The last five months have had little impact on the running business," the spokeswoman said. Investors also said yesterday that they were very keen to hear something concrete rather than more rumours, which had dragged on since January.

Winston Sammut, managing director of Maxim Asset Management, said the market had been on tenterhooks amid constant rumours and lack of solid information.