Freehills has proven that the age of stapling is far from dead, advising both Astro Japan Property Trust (Astro) and Lend Lease on their recent transition to stapled entities. Astro commenced trading as a stapled entity last week, following overwhelming approval at its recent AGM and   on Friday, Lend Lease will also commence trading as a stapled entity following 99% shareholder approval at its AGM.

Freehills partner Justin O’Farrell led the Freehills team in both of these deals and said that they prove there is still a market for stapling. “The system is under review but these deals confirm the age of stapling is not dead,” he said.

Each of the transactions were driven by different considerations with the Astro deal the culmination of the separation of the trust from Babcock & Brown earlier this year and the Lend Lease case being used as a cost-effective vehicle for acquiring property assets.

“We came up with a very innovative synthetic stapling designed to deliver the Astro deal with speed and certainty, without the need for unitholder meetings in the very uncertain times then confronting the Babcock Group,” O’Farrell said. “The recent stapling taken to unitholders introduced a more conventional internalised model that would reduce complexity for Astro in the future. It was very well received.”

The Lend Lease case was also unusual, O’Farrell said. The company is distributing units in a shell trust to its shareholders and then stapling. “The purpose is all around future flexibility for Lend Lease in acquiring property assets in a way which is effective for shareholders,” he said. “The proposal put to shareholders was assembled very efficiently and was very simple. Lend Lease has A$1bn in cash and flexibility for future acquisitions seems opportune.”

Apart from the public documents there is an enormous amount of other work needed to set up stapled entities, O’Farrell said, including regulatory liason, structural documentation and internal processes.