STOCKHOLM: EQT AB announced the signing of a combination with Exeter Property Group, a leading global real estate investment manager with more than USD 10bn of assets under management.
Total consideration of USD 1.87 billion, comprising new EQT AB shares of USD 800 million and cash USD 1.07 billion (including refinancing of USD 300 million of existing Exeter debt).
The combination accelerates EQT AB’s strategic growth ambition within Real Estate, creating a scaled thematic investment platform with global reach.
The transaction is part of EQT AB’s strategic growth ambitions within real estate and creates a scaled thematic investment platform across North America and Europe.
It also provides Exeter management with the ability to continue their track-record as a top performing real estate investment manager.
Furthermore, the transaction provides the ability to utilize synergies to further enhance investment performance and for the combined platform to benefit from EQT’s integrated approach to digitalization and sustainability.
Majority owned by Ward Fitzgerald and other Exeter management team, Exeter is focused on acquiring, developing and managing logistics/industrial, life science/office and residential properties mainly across the US and Europe.
For 2020, Exeter is expected to generate approximately USD 135m in revenues and approximately USD 80m in EBITDA (excluding carried interest).
The combination with Exeter creates a scaled, global real estate investment platform, adding one of the largest and well performing value-add real estate investment managers in the world to EQT’s successful platform.
At its core, Exeter acquires, develops and manages high-quality properties to deliver superior real estate solutions for its tenants and thus seeks to generate market-leading returns for its investors.
The combination will enhance EQT’s ability to provide investors with more diverse investment offerings and is expected to create private investment portfolios with strong and stable returns.
Christian Sinding, CEO and Managing Partner of EQT AB: “We are excited to accelerate our strategy of building a globally-scaled real estate platform and diversifying the firm within private markets by joining forces with Exeter. We have a high bar for strategic M&A, and Exeter is one of the few opportunities
we have identified which clears and well surpasses it. With its value-creation-focused investment approach, one of the strongest track-records in value-add real estate globally, and importantly, a people-and-performance-centric culture, we are all well-aligned.
I am delighted to welcome Ward and the Exeter team to the EQT family, and we are looking forward to working together to take EQT Exeter to the next level.”
Lennart Blecher, Head of EQT Real Assets and Deputy Managing Partner: “Scaling EQT’s real estate platform has been a key priority for EQT Real Assets. The combination of Exeter and EQT’s existing real estate business is highly complementary and creates a leader in thematic value-add real estate investments, allowing EQT to scale up local execution while also adding a prolific single asset deal platform.
Exeter is a hidden gem with very strong performance due to a clear operational mindset. We believe this is synergistic for both parties, with EQT able to bring multiple benefits to the Exeter business with the strength of our industry and client relationships and our future-proofed operating platform.”
Ward Fitzgerald, CEO and Founder of Exeter: “EQT is a fantastic strategic and cultural fit for our business. We share a similar philosophy and investment approach, and we have a complementary global platform which can accelerate the growth of opportunities that we make available to both current and future clients. For our day-to-day activities, it will be business as usual.
We will continue to be fully focused on driving returns by utilizing our unique local execution of small and mid-cap acquisitions, adhering to our real estate solutions ethic to our over 1,200 corporate client/tenants and directly performing our own leasing, property management and development. We are excited about the opportunity ahead of us to become more of a global leader in real estate by teaming with EQT.”
EQT Exeter will be part of EQT Real Assets (consisting of EQT Infrastructure and EQT Real Estate today). The combined real estate platform will operate under a joint EQT Exeter brand following closing and the existing EQT Real Estate business line will be integrated into EQT Exeter.
The ambition is that Exeter’s professionals will remain in place and will retain their participation interests in fund performance. EQT is committed to maintaining the leadership, business model, personnel, and culture that have supported Exeter’s success to date under the leadership of Ward Fitzgerald.
Ward will join EQTAB’s Executive Committee. EQT Exeter will be run independently but will be able to utilize the broader EQT operating platform, in order to scale efficiently while retaining the key success factors of Exeter.
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