Why LDR Assets Adjusted Its Takeover Offer Price for Elanor Commercial Property Fund

Background to the Supplementary Statement

LDR Assets Pty Ltd, acting as trustee for the LDR Assets Trust, has released a second supplementary bidder’s statement concerning its off-market takeover bid for all stapled securities in the Elanor Commercial Property Fund (ECF). This follows earlier communications, including a replacement bidder’s statement and a first supplementary bidder’s statement, and aims to clarify key financial terms amid ongoing discussions with the ECF Independent Board Committee (IBC).

Clarifying the Offer Price Adjustments

The core issue addressed in this latest statement revolves around the adjustments to the offer price triggered by the ECF’s September 2025 quarterly distribution of 1.625 cents per security. LDR explains that for securityholders who accepted the offer on or before 26 September 2025, the cash consideration remains at $0.70 per security. However, for those accepting after this date, the cash component is adjusted downward to $0.68375 per security to account for the distribution, which they will receive directly from ECF.

This nuanced differentiation aims to ensure that the offer price fairly reflects the value of the securities post-distribution, maintaining market-standard practices. The Bidder also stresses that the offer premium, previously cited as 1.9% above ECF’s 30 June 2025 net tangible asset (NTA) per security, incorporates both the cash offer and the value of retained rights such as distributions.

Tensions with the Independent Board Committee

LDR Assets openly critiques the ECF IBC’s concerns regarding disclosure adequacy as “frivolous and without merit,” suggesting that the IBC’s actions risk incurring unnecessary transaction and legal costs. These costs, the Bidder warns, would ultimately erode the underlying NTA of ECF, negatively impacting all securityholders. The statement underscores a perceived misalignment between the IBC’s approach and the broader interests of ECF investors, noting that neither Elanor Funds Management Limited nor the IBC members appear to hold relevant interests in ECF securities.

Implications for Securityholders and Market Participants

For securityholders, the clarification provides important guidance on the financial terms of the offer and the timing implications related to the September distribution. The Bidder encourages holders to consider these details carefully and consult professional advisers if needed. Meanwhile, the call for transparency around transaction costs incurred by ECF in responding to the offer highlights a key area of investor interest, as these costs directly affect the fund’s valuation metrics.

Overall, this second supplementary statement serves both as a detailed financial update and a strategic communication aimed at managing regulatory and shareholder scrutiny during a complex takeover process.