Aspen Under Focus – Update On Investment Management Proposal From Discovery Holiday Parks

Aspen group

Aspen Group (ASX: APZ) has continued its efforts towards achieving its business plans in FY 2018 and improving the securityholder’s returns. The business has managed to double its investment portfolio of core assets and divest all non-core assets over the past 24 months.

The current business initiatives by the company in the tourism sector include applying dynamic and sophisticated distribution and marketing efforts, increasing the use of flexible labour and improved management of permanent and temporary staff and using data analytic insights for tactical decision making.

During FY 2018, the company completed the acquisition of 2 properties, namely Koala Shores near Newcastle NSW and Darwin FreeSpirit Resort in Darwin. It has already 2 existing tourism assets where significant capital works are undergoing. On the upcoming pipeline front, the company Development activity at 4 Lanterns is well underway with the 28-site expansion due for completion June 2019. It also recently commenced works at Tomago under a revised business plan which would increase density of the estate and form 52 additional sites within the community.

The Independent Board Committee (IBC) with its chairman Clive Appleton and Non-Executive Director Guy Farrands provided an update in relation to the alternative investment management proposal submitted by Discovery Holiday Parks Limited.

The IBC welcomes Discovery’s interest in establishing a relationship with the Aspen Group. The investment management proposal from Discovery is conditional, indicative, non-binding and incomplete and is not an assurance of leading to any transaction. Discovery is a major competitor of Aspen Group and they both have competing assets in certain markets. The IBC is devoted in delivering management solutions for Aspen Group which will help unlocking great potential value to the security holders. It has appointed Moelis Australia Advisory Pty Limited as financial advisor and Hall & Willcox as the legal advisor for its smooth functioning.

The IBC and its advisers are discussing the matter with Discovery and are trying to have further clarifications in terms of certain aspects related to the investment management proposal. It is trying to establish whether it could lead to a binding proposal that is in the best interests of securityholders and superior to the proposal from Mill Hill Capital Pty Ltd.

The IBC will update and inform the market about the progress of the deal and any material developments and may further announce its next update on Tuesday December 11, 2018.

The current market price of the company is $0.950 with a P/E of 115.85 and an EPS of 0.008 AUD. It has maintained a stable dividend pay-out over the last 5 years with an annual dividend yield of around 4.42%.


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