Castellum boss will tempt Entra owners with sugary deals and billion sales – E24

Higher bids and SEK 18 billion property sales are two arguments he hopes Castellum CEO Henrik Saxborn will persuade Entra shareholders.

The battle for the Norwegian real estate giant took another turn on Friday afternoon, when Castellum announced a new and superior offering.

– We see that we can present an attractive offer for both Entra and Castellum shareholders, Saxborn tells E24.

More cash and a billion sales

The offer is not only in cash, but also in shares, so the valuation will fluctuate with the price of Castellum’s share.

• The new proposal offers eight Castellum shares for every 13 Entra share.
• Plus NOK 54.39 in cash per Entra share, more than double the previous offer.
• Castellum values ​​the new proposal at a total of NOK 185 per share, up from NOK 171 when the first offer was submitted in November.
• The previous offering consisted of 13 Castellum shares for every 20. Entra share, plus NOK 25.68 in cash per Entra share.

Saxborn also notes that Castellum has reached an agreement with the large Blackstone fund. The latter will buy 214 Castellum properties in two installments, for a total net amount of SEK 18.1 billion.

The first five billion kronor sale will take place anyway, while the last one is on the condition that the bid for Entra be completed, according to Saxborn.

According to Castellum, Blackstone will pay a price 20 percent higher than the last valuation of the properties.

– We have sold one of the largest logistics portfolios in Sweden with a capital gain of 20 percent, which will also benefit the owners of Entra if they accept this merger, says Saxborn.

Saxborn contends that Entra recently improved the value of their properties by eight percent, while they themselves will now sell properties at a 20 percent premium.

Still waiting

Several of the Norwegian shareholders are still in the think tank. However, the payment in the form of Castellum shares hasn’t been at the top of Alfred Berg’s manager Leif Eriksrød’s wish list.

– We can consider it carefully, but we have said previously that we prefer cash offers rather than liquidation in Swedish real estate stocks, he writes in a statement.

Several Alfred Berg funds are listed on shareholder lists with just over three million shares worth around NOK 560 million in Entra, corresponding to a total ownership stake of 1.7 percent.

Storebrand, which owns Entra shares in various funds, does not immediately jump into Castellum’s offer.

– Of course, we appreciate that Castellum increases the offer. We will continue to engage with and trust board and management assessments, writes portfolio manager Alf Inge Gjerde in an email.

– We have full confidence that the board and management will do what is necessary in an interesting situation for shareholders, he continues.

The Entra board has so far not given any recommendation for any offer, but stated on Friday afternoon that it “will consider the offer thoroughly.”

Various obstacles

There are several obstacles for Saxborn on the road to a full acquisition of Entra, both potential bidding competitors and store owners who may block a purchase.

Competitor Samhällsbyggnadsbolaget i Norden (SBB) has signed up again for the Entra hunt after they first dropped out.

At the same time, billionaire Erik Selin and his Balder Fastigheter have bought a 15 percent ownership stake, which is enough to block a full takeover of Entra.

Folketrygdfondet also has enough shares to block a full acquisition.

– We have a strong offer for all shareholders, including these two big ones. We have a future together that can generate a lot of value. I think this is an offer they want, Saxborn says.