Listed Australian firm Valad Property Group is placing European and UK holdings, worth hundreds of millions, in a 50:50 joint venture with Bank of Scotland.
Listed Australian firm Valad Property Group is placing European and UK holdings, worth hundreds of millions, in a 50:50 joint venture with Bank of Scotland.
Valad said it was contributing property valued at A$469 mln (EUR 268 mln), associated liabilities of A$761 mln (EUR 435 mln) and net equity in joint ventures and investments of A$382 mln (EUR 218 mln) to create the Diversified UK and European (DUKE) joint venture.
Bank of Scotland is has also contributed assets and associated liabilities. DUKE will have a three-year term.
Valad will continue to own the Valad European funds management business, which will provide management services to the joint venture. Valad said it expected to be well placed to secure the management of future work-out assets from Bank of Scotland and other financial institutions. Valad also intends to launch future opportunity funds.
Bank of Scotland has provided new undrawn facilities of £66 million (A$135 million) to the joint venture. A fee of £25 million (A$51 million) is payable by DUKE on termination of the DUKE debt facilities.
Explaining the creation of DUKE, Valad said: 'These agreements represent another significant milestone in the execution of Valad’s restructuring strategy, following the extension of Valad’s Asia Pacific debt facilities in February this year.
'The next component of Valad's restructure is to finalise arrangements for the £36 million (A$73 million) Scarborough deferred payment, which is due for payment in September 2009. Having reached this stage of Valad’s restructuring, the group is now in a position to refocus on growing the business.'
