Brookfield agrees €1.09b deal for Ireland's Hibernia

A subsidiary of Canadian investor Brookfield Asset Management has agreed a deal for Ireland's Hibernia REIT, valuing the company at €1.09 bn. 

Hibernia's board unanimously recommended shareholders accept the offer price, which represents a 35.6% premium to Thursday's €1.18 closing price.

Chairman of Hibernia REIT, Danny Ktichen, said: 'Despite significant progress against its strategic objectives and a track record of successfully recycling capital into value accretive opportunities, Hibernia REIT has traded at a persistent discount to its prevailing EPRA NTA per share.

'The acquisition recognises the company’s prospects and the quality of its portfolio of assets and delivers an acceleration of the value we expect to be created from completion of Hibernia Reit’s major office development projects.'

The takeover is being carried out by a Brookfield Bidco vehicle. According to Brookfield, the financial terms of the deal are final and will not be increased.

Reflecting the fact that Hibernia's shares have been trading at a 21% average discount to net asset value over the last five years, the offer represents a 5.7% discount to the company's value at end of 2021. Hibernia, an office landlord with tenants including Deliotte and Twitter, has reported 'uncertainty' over the future of the office market.

The bid also reflects recent changes to the taxation regime for Irish REITs and follows a take-private deal for office peer Green REIT, which was acquired by Henderson Park two years ago after consistently trading at a net discount to asset value.

'The acquisition allows Hibernia REIT shareholders to realise the value of their investment in Hibernia REIT in cash at a significant premium to Hibernia REIT’s prevailing share price and a premium to its EPRA NTA per share, when taking account of the directors’ current estimates of expected latent tax and debt breakage costs for Bidco,' Kitchen said.

The offer is conditional to shareholder approval at an extraordinary general meeting.

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