ASX-listed Dexus has confirmed talks to buy AMP’s Australian real estate and infrastructure equity management business.
“Dexus notes that it regularly reviews strategic opportunities that have the potential to enhance security holder value. At this stage, there is no certainty that a transaction will result,” Dexus said in response to ongoing media reports of the negotiation.
AMP also confirmed the discussion but said Dexus was one of “multiple parties” holding discussions regarding the potential sale of the assets and businesses of Collimate Capital (formerly known as AMP Capital).
AMP said that while these discussions continued, AMP remained in a position to pursue either a sale or demerger of these businesses.
The AMP Capital real estate platform includes a shopping centre fund and a flagship A$7bn office tower fund (which owns stakes in several of Australia’s best known blue-chip office towers, including the newly completed Quay Quarter Tower in Sydney’s Circular Quay).
AMP Capital’s Australian infrastructure funds own stakes in Melbourne international airport and Launceston airport, along with student housing and other social infrastructure assets.
Investment banking sources told the media that, if concluded as expected, Dexus was expected to pay between A$200m and A$300m for the management rights of AMP’s Australian real assets.
This would bring an end to AMP’s plan to demerge AMP Capital from its banking and wealth management businesses and to list the entity on the Australian Securities Exchange.
Instead, it would use proceeds from the sales of its real asset management businesses to rebuild its wealth management business.
As part of a demerger strategy unveiled a year ago, AMP Capital had been separated and rebranded as Collimate Capital.
In recent weeks, media reports suggested that suitors including Singapore CapitaLand Group, Cromwell Property Group, Blackstone and the US manager, Apollo Asset Management, were keen to pursue parts of the AMP Capital fund management platform.
Apollo has been reported to have shown keen interest in AMP Capital’s offshore infrastructure assets, which include Angel Trains, the UK’s largest rolling stock company, Alpha Trains in Luxembourg, part ownership of power transmission in India and Powerco in New Zealand.
Last December, AMP Capital sold its infrastructure debt platform, which managed A$7bn in infrastructure debt to Ares Management for A$430m.
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