The Centuria Capital Group (ASX: CNI) share price will be worth watching when it emerges from a trading halt on Thursday after launching an NZ$180 million (A$174 million) takeover offer.
What could move the Centuria Capital share price tomorrow?
Today, Centuria announced the move to acquire August Capital Ltd, one of New Zealand's largest listed real estate funds management platforms.
Augusta manages assets across a range of listed, unlisted and private funds. Centuria is looking to integrate the group into its existing platform and deliver immediate scale in the New Zealand market.
The $1.08 billion property group believes Augusta complements its existing office and industrial markets expertise and could make it a leading funds management platform in Australiasia.
If the acquisition is successful, Centuria's assets under management (AUM) could increase by $1.9 billion to $9.2 billion. The Centuria Capital share price will be one to watch as investors mull over the potential 26% increase.
Augusta shareholders will be offered NZ$2.00 per share in either cash or Centuria scrip. That represents a 19.8% premium to the current NZ$1.67 per share valuation on 28 January 2020.
Augusta's founders/key executives currently hold 36.2% of Augusta shares. However, these individuals have entered into pre-bid lock-up agreements and agreed to accept the offer.
Centuria is looking to fund the acquisition from existing cash reserves, shares and the net proceeds of a new $60 million equity raising at A$2.34 per share. The Centuria Capital share price closed at A$2.41 yesterday, making for a 2.90% discount offer price.
The underwritten institutional placement will strengthen Centuria's balance sheet ahead of the acquisition.
What else did Centuria announce?
The Centuria Capital share price is also worth watching because of its FY20 guidance update today.
Centuria announced AUM growth of $1.2 billion during the first half of the year with a strong transaction pipeline in the 6 months ahead. The group's unaudited 1H 2020 operating earnings per share (EPS) came in at 8.1 cents.
Centuria reaffirmed its FY20 forecast distribution of 9.7 cents with FY20 operating EPS of 12.5 cents.
