The acquisition of Australian Unity Office Fund ((AOF)) will not proceed. This follows a vote by AOF unit holders. Both Abacus Property and Charter Hall ((CHC)) had indicated no further offer would be made if the scheme was not approved.
In theory, Credit Suisse believes there will be a potential earnings drag until alternative investments are found. Abacus Property raised $250m of equity, of which a large portion was earmarked to fund its share of the proposed acquisition.
Meanwhile, earnings guidance for FY20 is unchanged. Neutral rating and $3.93 target maintained.
Sector: Real Estate.
Target price is $3.93.Current Price is $3.83. Difference: $0.10 – (brackets indicate current price is over target). If ABP meets the Credit Suisse target it will return approximately 3% (excluding dividends, fees and charges – negative figures indicate an expected loss).