UNITED STATES - Australian-based Challenger Financial Services Group Limited has formed a strategic relationship with Los Angeles-based Colony Capital to invest in real estate and infrastructure in the US, Europe and Asia.
Challenger and Colony believe their complementary skills in real estate and selected commercial and residential developments could provide "significant opportunities" over the medium to long-term.
Colony currently has positions in the three main regions of the world aåçnd is active in includes hotels, office and residential so the aim is to tap into Challenger's strong Australian base and global infrastructure expertise to develop opportunities across shared core capabilities, including real estate and infrastructure.
Challenger has had a small presence in Europe for some time through its Challenger Diversified property group and around 11% of its portfolio is based in Europe so the firm hopes it can accelerate its offshore growth plans through its new relationship.
Colony Capital's main investment vehicle is its commingled fund, Colony Investors VIII, which has seen a total fundraising of $4bn (€$2.94bn) through institutional clients and pension funds.
As part of the relationship, Colony will acquire an option of 57.1m Challenge ordinary shares at a cost of $64m, exercisable over a five-year period at $7.00 per share.
As part of the deal, Colony's founder/chief executive Thomas Barrack Jr will join the board at Challenger.