The Blackstone Group has agreed to buy the Valad Property Group, an Australian real estate firm, for about $227 million. It will also take on Valad’s $655 million in debt.
The deal comes two months after Blackstone agreed to pay $9.4 billion for the United States shopping mall assets of Australia’s debt-laden Centro Properties.
But the Valad acquisition is a bet on the Australian property market. The firm has about 8 billion Australian dollars worth of assets, most of them in its home country.
Blackstone has offered 1.80 Australian dollars per share in cash, representing a more than 50 percent premium to its most recent closing price, but almost 35 percent less than the firm’s net asset value.
Valad shares surged 0.60 Australian dollars, or 52 percent, to 1.75 Australian dollars in Sydney on the news.
“After receipt and assessment of the Blackstone proposal, the Valad Board considers that it provides the most certain value proposition for all Valad securityholders,” Trevor Gerber, chairman of Valad, said.
A more thorough description of the deal will be sent to Valad shareholders in June, and a shareholder meeting is set to take place the following month.
Blackstone’s extensive property portfolio helped propel the firm’s earnings, reported last week, to their highest since the firm went public, also driving profit, which was up 58 percent.
Fort Street Advisers provided Valad with financial advice, and Mallesons Stephen Jaques with legal counsel.
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