The company will acquire $415m in assets funded in part by a $250m rights issue. UBS estimates the transaction will be marginally dilutive to earnings and this explains the underwhelming FY22 growth guidance of 2.75%.
The attractive attributes of the portfolio of buildings in which Charter Hall Long WALE will acquire a 50% stake include around 75% of leasing to government tenants.
Neutral rating maintained. Target is reduced to $4.77 from $4.80.
Sector: Real Estate.
Target price is $4.77.Current Price is $4.81. Difference: ($0.04) – (brackets indicate current price is over target). If CLW meets the UBS target it will return approximately -1% (excluding dividends, fees and charges – negative figures indicate an expected loss).