It isn't a great deal but it isn't bad either. There are two...

It isn't a great deal but it isn't bad either.

There are two factors we have to consider:
1. Water rights - If you include the water rights (which isn't valued on their balance sheet), NTA is $0.91 per share.

The second factor is the biggest one.
2. Increasing base rent by 2026 - If Costa Group exercise their option, their base rent will go up to $21.4m. Then you add the variable rent (let's say on average $8.4m), you get total rent of $29.8m.
Based of a 67% FFO margin, we get $20m FFO which is a 14% yield (based on $0.78 per share). At $1.00 per share, they are buying VTH for a 11% yield.

Considering RBA just recently reduce their cash rate again, an 11% yielding ag asset is highly attractive.

An average deal would be 10-11% for us which brings us to the $1.00 per share.
A great deal would be a 7% yield for us which is $1.54 per share.
A super great deal would be 5% which is $2.16 per share.