Goodman's Move for NextDC Stake Looks Intriguing

Dow Jones11:49

0348 GMT - Morgan Stanley analysts are intrigued by Goodman's attempt to acquire a stake in data-center operator NextDC, especially given the Australian property developer's focus on capital discipline. NextDC says Goodman and JV partner Digital Realty are trying to build a 9.9% stake, which the MS analysts estimate would require an outlay of A$360 million from Goodman. This is fairly minor given Goodman has A$36 billion in assets, they write in a note. They wonder what Goodman's intentions are, pointing out that NextDC's portfolio would give its longstanding data-center ambitions immediate scale. MS has a last-published overweight rating on Goodman shares and a target price of 36.15 Australian dollars. Shares are up 5.7% at A$28.39.

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