NextDC boosts offer for APDC in bidding war
Mon 31 Jul 2017
NextDC has once again increased its offer to buy a controlling stake in Asia Pacific Data Centre (APDC), as part of an ongoing battle for the data centre real estate specialist.
The new bid from NextDC stipulates an increased price per share of AU$1.87 (approx. £1.14), and an unconditional offer, which the company says will provide increased confidence for APDC shareholders.
As well as this, investor relations manager at NextDC, Rahul Badethalav, played up its financial position, saying: “We are also capable of buying stock on market today, which means shareholders can have the confidence and certainty that they can go on the market and lock that money in the bank.”
Several offers have been made throughout July as Australian investment firm 360 Capital battle with NextDC for control of the company.
This most recent offer of AU$1.87 per share from NextDC represents a 19.5% increase on APDC’s closing share price of AU$1.565 on May 1. 360 Capital bought a 19.9% stake in APDC the following day at AU$1.56 a share.
NextDC stepped in on July 19, paying AU$1.78 a share to acquire a 14.1% stake. The following day 360 Capital bid at $1.80 a share, an offer it has not increased upon since. This offer also contained a proposal to replace APDC’s board of directors.
Last week 360 Capital submitted another proposal, which removed the intention to replace the board. However, NextDC has called this offer ‘highly conditional’ and demonstrating ‘poor corporate governance.’
In response to 360 Capital’s proposal, NextDC on Wednesday updated its offer to AU$1.85 per share, as well as buying an increasing number of shares, upping its stake to 19.9% of the company. This was the final offer before the unconditional proposal at AU$1.87 a share on July 31.
This offer effectively represents a price of around AU$215 million. NextDC has said that it has excess liquidity of AU$460 million, including cash reserves.
NextDC is Australia’s leading independent data centre operator and provides colocation services, outsourcing solutions, and infrastructure management software. APDC specialises in real estate for land and buildings that are being operated as data centres, and has properties in Melbourne, Sydney, and Perth, all of which are occupied by NextDC.
Badethalav has said that NextDC was concerned with the possibility of having 360 Capital owning the buildings in which its data centres are housed, which pushed the company to make a rival offer. He also noted the advantages of owning both the land and the data centre.