Dexus is to take over the bulk of AMP Capital’s A$28bn (€18.9bn) Australian real assets platform in a deal that could be worth up to A$1bn.
AMP said it had agreed to sell Collimate Capital’s real estate and domestic infrastructure equity business to Dexus for an upfront cash consideration of A$250m. In addition, Dexus will pay “earn-out consideration” of up to A$300m.
As part of the deal, Dexus was expected to acquire co-investment stakes held by AMP in its platform for up to A$450m.
The move will set Dexus up as an infrastructure asset manager, with an instant portfolio of A$9.2bn in assets, including two domestic airports in Melbourne and Launceston. The AMP platform will boost Dexus total assets under management to almost A$73bn.
“Infrastructure is a logical next step for Dexus’s funds management business, underpinned by compelling sector fundamentals and a positive growth outlook,” said Darren Steinberg, Dexus’s chief executive officer.
Dexus said it was committed to acquiring A$270m in AMP Capital’s stakes in its funds, and, subject to discussions, Dexus could buy the balance of the stakes, totalling A$450m.
AMP Capital, now known as Collimate Capital, manages A$18.2bn in real estate held in five pooled funds and seven separate accounts, and A$9.7bn in Australian infrastructure assets, held in 7 pooled funds and five separate accounts.
Asked if all AMP Capital investors were on board for the change in management, Steinberg told IPE Real Assets: “We will be undertaking detailed discussions with investors over the coming weeks and months and will provide an update at our results announcement (in August).”
AMP Limited chair, Debra Hazelton, said: “The sale of the real estate and domestic infrastructure equity business is a strong outcome for AMP shareholders and Collimate Capital stakeholders.”
AMP chief executive, Alexis George, said: “In Dexus, we have found a strong owner for the real estate and domestic infrastructure equity businesses, which will add significant value through their strong track record and experience in real estate and asset management.”
The transaction is expected to complete during the second half of 2022 and Dexus will use debt facilities to fund the acquisition.
Despite today’s announcement, analysts pointed out that rival group Mirvac was attempting to gain due diligence to put forward a proposal to manage the AMP Capital Wholesale Office Fund (AWOF).
Dexus said AWOF would be managed as a standalone vehicle under Dexus.
Separately, AMP is negotiating with international fund managers to sell its global infrastructure platform.
It is widely reported that US firms Apollo Asset Management and DigitalBridge are competing for the manager’s offshore infrastructure portfolio.
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