Goodman Group could buy the ING Industrial Property Fund if its capital raising goes to plan and we could also soon see more takeover action in coal and gas. Elsewhere, the silver doughnut faces a barrage of criticism over its funds management model, healthcare companies signal acquisitions and fun times at Funtastic.
Goodman Group
Fresh from announcing its capital raising, Goodman Group is again in a trading halt pending an announcement of how the raising's institutional component was received. Word on the street is that investors are enthusiastic about the $1.279 billion offer, following China Investment Corporation's (CIC) cornerstone placement of $500 million, albeit through hybrid securities that could give the sovereign wealth fund 182 per cent of Goodman upon conversion. Speculation that CIC could acquire individual properties from the fund – which is meanwhile launching a $200 million joint venture in the Middle Kingdom along with Canada Pension Plan Investment Board – also give additional reasons to believe that its debt-addled days could soon be over. Then again, credit rating agency Moody’s has maintained a downgrade review watch on the Goodman, just in case things don’t all go to plan. The $1.279 billion raising comprises a $167 million institutional placement and a $1.112 billion one-for-one accelerated non-renounceable entitlement offer. Net proceeds will be used to reduce debt and clean up the capital structure. There is a rumour however that Goodman could also use the funds to acquire the ING Industrial Fund on the cheap. Goodman is IIF's second biggest shareholder and according to a Goldman Sachs JBWere analyst report a takeover could be made in conjunction with CIC.
GMG Price at posting:
44.5¢ Sentiment: LT Buy Disclosure: Held
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