Australand stock down after GPT pulls bid but new offer may yet emerge SHARES in Australand fell more than 4 per cent today after GPT Group announced yesterday it was abandoning its $3 billion bid for the rival company. The company's share price was down 4.25 per cent in early afternoon trading to $3.38 after hitting a low of $3.31 earlier in the session. But the stock is still higher than before the bid by GPT was made public. Australand announced it had been approached by GPT on December 10, causing shares in Australand to gain 6.29 per cent to $3.21, up 19c. Soon after, the Australand board rejected GPT's $2.94bn bid for its office and industrial businesses as too low and opened the property company's data room to other parties that could also be interested in the entire business. Last month the stock was trading almost 25 per cent higher than prior to the GPT bid, although it has retreated in recent weeks. Yesterday, GPT said that following detailed due diligence and discussions, it was apparent that a transaction at a price GPT was willing to pay was not possible. Capitaland, which has signalled that it wants to divest its 59 per cent of Australand, would be unlikely to embark on a block trade of its share in the business until the market improved, a source said. The source added that Australand's net tangible asset backing was $3.49, and if Capitaland, a Singaporean real estate giant, sold it below that, they would have to book the sale as being at a loss in its accounts, which the company would be reluctant to do. Should GPT's inital attempt last year to secure Australand's commerical and industrial businesses have been successful, it would have left Australand's investors with shares in a company that owned just $900m worth of residential developments amid challenging market conditions. Office and industrial divisions comprise almost 75 per cent of Australand's overall operations on a valuation basis. John Kim, CLSA's head of real estate research for Asia Pacific, said GPT's decision to discontinue its pursuit of Australand was positive in that GPT did not overpay, but also demonstrated that the bidder did not have a sophisticated game plan. "Tellingly, there was no interest in Australand's resi business, highlighting developers' aversion to more exposure to master-planned communities and Victoria," Mr Kim said. But he added that the company could still be a takeover target.