GPT has redeemed its exchangeable securities issued to GIC and has funded the cost through a $325m raising and $50m SPP. Given the securities paid a coupon of 10%, the raising is earnings accretive, the broker notes. The group now has a strong balance sheet and will likely be an M&A player.
The broker sees this as a prudent move and on an attractive total shareholder return forecast, retains Outperform. Target rises to $4.44 from $4.33.
Sector: Real Estate.
Target price is $4.44.Current Price is $4.36. Difference: $0.08 – (brackets indicate current price is over target). If GPT meets the Macquarie target it will return approximately 2% (excluding dividends, fees and charges – negative figures indicate an expected loss).a.com for a free trial.