NextDC boosts offer price to acquire APDC
NextDC has updated its proposal to acquire remaining shares in Asia Pacific Data Centre Group (APDC), increasing its per-share price from AU$1.85 to AU$1.87.
Additionally, the Australian-listed datacentre company has made the offer unconditional to "provide certainty" to APDC shareholders.
"We are also capable of buying stock on market today, which means shareholders -- in particular retail shareholders -- can have the confidence and certainty that they can go on market and sell their stock to NextDC at that price today and lock that money in the bank," Rahul Badethalav, investor relations manager at NextDC, told ZDNet on Monday.
NextDC's latest offer represents an 19.5 percent premium over APDC's closing share price of AU$1.565 on May 1, the day before 360 Capital acquired its initial 19.9 percent stake in the property trust for AU$1.56 a share.
Over the last week, NextDC has purchased additional shares, increasing its stake in APDC from 18.6 percent to 19.99 percent.
"Now that we launched an unconditional takeover offer this morning, we are capable of buying more [shares]," Badethalav said.
Rival bidder 360 Capital's offer of AU$1.80 per share remains unchanged.
The property trust, which called for and eventually withdrew a meeting to oust APDC's management, said it expects to launch its due diligence process on Monday. The process is expected to take up to three weeks before 360 Capital is in a position to make another offer.
"We note that the NextDC price is not expressed to be final and therefore NextDC is capable of increasing the offer price," 360 Capital said in a disclosure to the Australian Securities Exchange.
"360 Capital will continue to access its options with regard to its stake in [APDC]."
360 Capital's acquisition proposal submitted last week, which NextDC said was "highly conditional" and reflected "poor corporate governance", removed the caveat of replacing APDC's board of directors.
Should NextDC's revised offer be accepted, the datacentre company would be paying approximately AU$215 million from its existing cash reserves. NextDC said it has excess liquidity of more than AU$460 million as of June 30, 2017, inclusive of cash reserves and a senior corporate debt facility.
Badethalav told ZDNet last week that the datacentre company -- which is the sole tenant of APDC's datacentre facilities in Sydney, Melbourne, and Perth -- was prompted to submit an acquisition offer because of concerns around 360 Capital as a potential landlord.
He said that there are also "meaningful benefits" for customers in being the datacentre operator as well as the owner of the land that sits underneath the datacentres.
Additionally, he pointed out that NextDC's balance sheet also benefits from owning the land as banks are more comfortable lending against land.
"Naturally, given our datacentres sit on the land itself, it would be a fairly straightforward transaction to make," Badethalav said previously.