ING dangles expansion lure to Calan investors

ING Property Trust has promised Calan Healthcare Properties Trust's unitholders a better deal if they accept its takeover offer.

ING promises the chance of better returns, greater scale and a more diverse investment portfolio.

Calan investors are being enticed to accept ING's $1.25-a -unit offer by investing in a larger entity that has 100 properties worth $830 million.

ING chief Mike Smith wrote to Calan investors this week saying that if the offer succeeded, the combined entity would own property worth $1.03 billion, made possible by absorbing Calan's $204 million portfolio.

"ING believes it can grow Calan's portfolio more effectively than Calan is able to alone," he wrote. "A more diverse property portfolio reduced Calan's targeted exposure to a small number of major healthcare tenants."

If ING took over Calan, the merged entity would also have an increased NZSX-50 weighting and the prospect of higher dividends.

But Calan is resisting. Directors have restated their recommendation to unitholders to take no action until the board has received an independent appraisal report and made a recommendation to the market.

They have appointed valuers Ferrier Hodgson to advise on ING's offer.

ING owns 15.5 per cent of Calan after increasing its stake ready for a full takeover. Calan's units are trading around $1.28.

Calan directors will release new property valuations soon.