Why investors should accept CapitaLand's $3.06b bid to take over CMA

It's a 'good' deal, says analyst.

According to OSK-DMG, 5 years after listing CapitaMall Asia (CMA SP, Unrated) at $2.12, parent CapitaLand (CAPL SP, Unrated) under new management team helmed by CEO LIM Ming Yan, is making a Voluntary Conditional Cash Offer of $2.22 (20.7% premium to NAV and 23% premium to last traded price) for the 34.7% shares it does not own (circa $3.06 bn). OSK-DMG thinks the offer is good and urge investors to accept the bid.

Here's more:

The strategic thrust of streamlining CAPL Group appears to be taking momentum with this Offer coming on the back of disposal of subsidiary Australand in FY13.

CAPL has obtained waivers and there will be no downstream chain listing offer for CMA’s listed REITs, namely CapitaMall Trust (CT SP, Neutral, TP $2.36), CapitaRetail China Trust (CRCT SP, Not Rated), CapitaMalls Malaysia Trust (CMMT MK, Not Rated). However, we believe this will be positive for the REITs as it removes an intermediary layer of ownership within the capital recycling model.

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