Growthpoint has re-submitted its proposal to acquire GPT Metro Office Fund ((GMF)). The offer, valued at $2.31 per GMF security, is 50% cash and 50% scrip. Macquarie estimates the transaction will be 2.2% accretive to Growthpoint unit holders if completed.
Growthpoint’s earnings and dividend were in line with expectations. It was a busy FY14, featuring acquisitions, a capital raising, a 25% increase in asset base and the granting of an investment grade credit rating.
Growthpoint has provided FY14 earnings guidance of 19.9-20.0cps and the extended its debt on more stringent covenants, increasing weighted cost to 6.71%. The broker is forecasting 20c EPS and notes GOZ’s commitment to reducing LVRs. While the new covenants are tighter the broker notes GOZ still has plenty of headroom.