Centuria confirms strategy talks with shareholder E-shang Redwood

E-shang Redwood (ESR), backed by Warburg Pincus, has restarted talks with Centuria Capital Group over the future of another Australian property trust, Propertylink Group.

Listed Centuria confirmed to the ASX that it is in discussions with ESR, following media speculation the company is due to hold talks shortly with their counterparts in ESR and Warburg Pincus.

ESR has significant stakes in both Centuria and Propertylink following surprise raids on their share registers last year.

Centuria acquired a collective stake of 17% in Propertylink as a precursor to a take over offer in September last year. 

ESR came into the picture in October to snap up 19.9 % in Propertylink and also a 14.9% stake in Centuria. 

ESR met with Centuria and also Propertylink, but those talks ended out without an outcome.

With each blocking the other in its attempt to take over Propertylink - which owns industrial and office buildings in various unlisted funds - the situation appeared to be in a stalemate, until now.

It is thought that the parties might agree to jointly take over Propertylink, then carve up the assets, with ESR taking the industrial portfolio and Centuria the other assets.

In response to latest market speculation, Centuria told the ASX that “it regularly holds discussions with its substantial shareholders in relation to the strategic direction of Centuria”.

The statement said: “As a part of these (discussions), Centuria has had and continues to have discussions with its substantial shareholder, ESR (which is also a substantial security holder in Propertylink.”

Centuria said that these discussions have canvassed a wide range of issues, including support for Centuria’s strategy and capital initiatives and potential opportunities in the industrial and office space, including in relation to Propertylink.

“No agreement has been reached between the parties in relation to any of these matters,” it said, adding that as previously disclosed to the market, Centuria continued to look at a range of potential acquisition and partnership opportunities.

Meanwhile, Asian logistics group ESR has agreed with the Singapore-listed Viva Industrial REIT to a merger between Viva and ESR REIT, also listed on the Singapore stock exchange.

Market sources in Singapore told IPE Real Assets the parties had basically agreed on terms, but are awaiting unitholders’ approval at an extraordinary general meeting in a couple of months.

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