An offer by Canada Pension Plan Investment Board, Toronto, and DEXUS Property Group to acquire Australian office REIT Commonwealth Property Office Fund was rejected by the board of the fund's manager.
“After careful consideration, the board has determined that the DEXUS proposal does not provide a compelling value proposition for (the fund's) unitholders,” Richard Haddock, independent chairman of Commonwealth Managed Investments, said in a filing Monday with the Australian Securities Exchange. A revised proposal from CPPIB and DEXUS “will be considered on its merits,” he said in the filing.
The REIT has a total book value of A$3.7 billion (US$3.5 billion). On Oct. 11, CPPIB, which oversees C$188.9 billion (US$182.5 billion) in assets, and DEXUS made a joint offer of A$1.15 per unit of the REIT.
Linda Sims, CPPIB spokeswoman, said the board has no comment on the Commonwealth statement. Executives at DEXUS could be reached for comment.