Cromwell Property Group have put forward an additional $3 billion in their bid to acquire Investa Office Fund.
According to Business News Australia, the new bid was announced by IOF after the market closed on Tuesday and revealed Brisbane-based Cromwell has offered $4.85 per share in an unsolicited non-binding proposal to acquire all units in IOF. Shares in IOF closed at $4.72 before the announcement.
The offer also includes a 10c per share distribution for the half year ending June 30, 2017, and is subject to due diligence for 40 days.
Cromwell's increased offer will take the combined force of resources from itself and a number of global real estate investors, and will be funded through a combination of equity and debt, according to Cromwell CEO Paul Weightman.
Business News Australia said that Mr Weightman made contact with IOF chairman Richard Longes and said Cromwell believed that its $4.85 all cash proposal is a superior proposal to the internal restructure being contemplated, which was in reference to a previous announcement made by Investa that it was negotiating the acquisition of 50 per cent of one of its related entities.
"A failure to permit this due diligence will effectively close off the all cash proposal to securityholders," Mr Weightman said.
Cromwell's intention to acquire IOF dates back to 2016 when a offer was made for $4.45 per share in a deal worth $2.7 billion.
The current $4.85 per share offer is a nine per cent increase on the initial offer of $4.45, according to Business News Australia.
IOF have reportedly confirmed that the new Cromwell offer was being considered, but independent directors have not yet formed a view on the merits of the proposal.
"The independent directors propose to engage with Cromwell in relation to the proposal including its terms and conditions and the disclosure of the identity of the proposed equity investors," the IOF said.
Investa owns around 22 of Australia's largest office towers in capital cities, with government and blue chip tenants, and has a complicated ownership structure.