The directors of Commonwealth Managed Investments Limited (CMIL), the responsible entity of CFX, have agreed to the proposal in the absence of a better offer.
The CMIL decision is subject to an independent expert's report concluding that the proposal is in the best interests of CFX securityholders other than CBA and its associates.
CMIL chairman Richard Haddock said the proposed internalisation “better aligns management with securityholder interests”.
“CFX will benefit from lower costs, additional revenue streams and access to new growth opportunities,” said Mr Haddock.
Under the proposal, CFX will pay CBA a cash consideration of $460 million in order to: acquire CMIL; allow CMIL to assume management of CFX; and acquire a related integrated retail asset management business.
“The Independent Directors are supportive of the Proposal as outlined. If implemented, this would create one of Australia’s largest fully integrated and independently managed retail property groups,” said Mr Haddock.
“The Proposal is expected to provide distribution and value accretion to securityholders, it enhances governance and enables the smooth transition of personnel and systems to support the long-term strategic objectives of CFX,” he said.
