SYDNEY, AUSTRALIA: Dexus, Australia’s leading fully integrated real estate groups, has entered into a Share Sale and Purchase Agreement (SPA) with Collimate Capital Limited to acquire Collimate’s real estate and domestic infrastructure equity business. Collimate Capital Limited is a subsidiary of AMP Limited.
The consideration comprises a $250 million upfront cash payment and earn out consideration of up to $300 million, which is subject to a range of factors including successful transition of assets under management (“AUM”) and will be finally assessed nine months following completion of the Transaction.
In addition, Dexus will offer to acquire co-investment stakes in the platform for total cash consideration of up to approximately $450 million, subject to discussions with investors, pre-emptive rights processes and relevant consents.
Collimate’s real estate and domestic infrastructure equity business comprises a high-quality platform of pooled funds and separately managed accounts (“SMAs”). The platform currently has $27.9 billion of AUM, split between:
i. Real estate ($18.2 billion); and
ii. Infrastructure ($9.7 billion)
Dexus plans to hold consultation sessions with Collimate investors over the coming weeks to discuss the merits of the transaction and determine the Collimate AUM to be transferred to the Dexus platform as part of the Transaction.
Collimate holds co-investment stakes in the platform funds totalling circa $180 million, which Dexus will offer to acquire as part of the Transaction, subject to preemptive rights processes and relevant consents.
In addition, Collimate has provided a commitment to acquire a further circa $270 million of units in AMP Capital Wholesale Office Fund (“AWOF”), which Dexus will also offer to acquire as part of the transaction, subject to discussions with investors, pre-emptive rights processes and relevant consents.
Total cash consideration payable by Dexus for these co-investments is dependent on their Current Unit Value at the time and is anticipated to be circa $450 million.
Dexus intends to retain Collimate’s key people as part of the Transaction, to continue to support the real estate business and entry into the infrastructure segment alongside a strongly credentialed and established team.
The transaction is in line with Dexus’s strategy of expanding and diversifying its funds management business and will accelerate growth through the combination of two complementary platforms.
Darren Steinberg, Dexus CEO said: “I am excited to announce this opportunity which positions Dexus as a leading real asset manager, with new capabilities and an expanded product offering, underpinned by our best practice governance and risk management framework. It delivers on our strategic objectives of being a real estate partner of choice and delivering resilient income streams, while enhancing our ability to leverage the key megatrends benefiting real assets. This alignment forges the pathway to creating long-term value for our Dexus Security holders and the investors across our funds management platform, both existing and new.
“Infrastructure is a logical next step for Dexus’s funds management business, underpinned by compelling sector fundamentals and a positive growth outlook. The Collimate team has a strong track record and well established relationships with investors. This will now be enhanced by the core skills across the Dexus platform.
“Our more than 35-year track record in funds management, alongside our experience in integrating funds management businesses and assets, supported by transition services from Collimate, will enable us to provide continuity of service to our investors and funds management partners during the transition.”
Dexus (ASX: DXS) is one of Australia’s leading fully integrated real estate groups, proudly managing a high-quality Australian property portfolio valued at $45.3 billion.
Leave a Reply