Morris Group Offers $3.70 Per Unit in Rival Reef Casino Trust Takeover Proposal
Morris Group has launched a conditional, non-binding takeover proposal for Reef Casino Trust, offering $3.70 per unit, rivaling the existing Iris bid. The Independent Board Committee urges unitholders to hold off while assessing this alternative.
- Morris Group proposes $184 million cash takeover bid for Reef Casino Trust
- Offer matches terms of existing Iris Cairns Property bid at $3.70 per unit
- Proposal contingent on acquiring Casinos Austria International and Reef Corporate Services
- Independent Board Committee to evaluate proposal; recommends no immediate action
- Iris retains recommendation pending regulatory and expert assessments
A New Contender Emerges
Reef Corporate Services Limited (RCSL), the responsible entity for Reef Casino Trust (RCT), has disclosed an unsolicited and conditional takeover proposal from Morris Group. This alternative bid offers unitholders approximately A$184 million, equating to $3.70 per unit, mirroring the terms of the existing offer from Iris Cairns Property Pty Ltd.
Complex Conditions and Strategic Stakes
Unlike the Iris offer, Morris Group’s proposal hinges on additional acquisitions, including Casinos Austria International (Cairns) Pty Limited and RCSL itself, by affiliated entities. These conditions introduce complexity and uncertainty, as the completion of the takeover depends on successfully negotiating share purchase agreements for these entities.
Board’s Cautious Approach
The Independent Board Committee of RCSL is tasked with a thorough evaluation of Morris Group’s indicative proposal. Given the conditional and non-binding nature of the offer, the committee advises unitholders to refrain from taking any action at this stage. The committee continues to endorse the Iris offer, which remains the preferred bid subject to regulatory approvals and an independent expert’s fairness opinion.
Market Implications and Next Steps
This competing bid introduces a new dynamic to the Reef Casino Trust takeover saga, potentially sparking a bidding contest or prompting negotiations between parties. Investors will be watching closely for updates on the feasibility of Morris Group’s conditions and any moves by Iris to match or counter the alternative proposal. RCSL has committed to keeping the market informed of material developments as they unfold.
Bottom Line?
The Reef Casino Trust takeover battle heats up, but unitholders are urged to stay patient as the board weighs complex bids.
Questions in the middle?
- Can Morris Group successfully negotiate the required acquisitions to satisfy their bid conditions?
- Will Iris Cairns Property exercise its right to match Morris Group’s alternative proposal?
- How will regulatory and independent expert assessments influence the final recommendation?
