The Investa Office Fund (ASX: IOF) share price is down 2.5% today after Cromwell Group (ASX: CMW) announced that it was selling its 10% stake in IOF to Investa Property Group following a failed $3 billion takeover bid.
Investa Property Group now owns 19.95 per cent of IOF, which means it cannot acquire anymore shares without making a full bid.
Investa Office Fund owns a portfolio of office properties, the majority of which are graded A, in central business districts across Australia. The quality of its portfolio is above average and this has made it an acquisition target in recent times.
Whilst Cromwell will be disappointed that they couldn't complete a takeover of IOF, they have made a decent return on their investment. The agreed sale price of $4.65 per unit represents a premium to the IOF closing price on 3 October 2017 and an annualised Equity Internal Rate of Return of 18% for Cromwell.
