Queensland developer re-thinks takeover offer for struggling property group

Queensland property developer Don O’Rorke will says he will consider raising his takeover offer for property company Trinity Consolidated Group after the Trinity board rejected his offer as being too low.

Queensland property developer Don O’Rorke will says he will consider raising his takeover offer for property company Trinity Consolidated Group after the Trinity board rejected his offer as being too low.

O’Rorke, founder and chief executive of development group Consolidated Properties, is the co-founder of Trinity Group and currently owns around 12% of the company.

Last week he lobbed an 80c-a-share takeover offer to privatise the group, saying he was disappointed the company’s shares have slipped from a peak of $3.33 in late 2007 to just 43c.

But chairman Keith De Lacy says the deal undervalues the company, given Trinity has net tangible assets of $1.15 a share.

“The market has unfortunately not recognised Trinity’s lower risk profile and our core business settings, including high recurrent income levels, risk-managed development and conservative gearing,” he told the company’s AGM on Friday.

“The board still believes that once market conditions normalise, Trinity has the potential to grow earnings to more than 20c per security over the medium term.” Earnings per share were 15c in 2007-08.

Trinity is in the middle of a review of its management structure and is also trying to sell assets to reduce its gearing from 42% to 27%.

O’Rorke told The Australian Financial Review last week that any bid would be subject to due diligence and funding.

“What I am trying to do is to restore some values for the security holders in Trinity in a co-operative way.”

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