Dexus confirmed on Wednesday it has agreed to acquire Collimate’s real estate and domestic infrastructure equity business from AMP Limited.
AMP will receive a $250 million upfront cash payment, with a further possibility to bank another $300 million subject to Assets Under Management (AUM) retention over a nine-month period after completion.
In addition, Dexus will acquire all of AMP’s existing and committed sponsor stakes in the platform for cash consideration expected to be up to approximately $450 million, subject to discussions with fund investors, pre-emptive rights processes and applicable consents.
In a separate filing with the ASX, AMP said it considers it unlikely the full $300 million earn-out will be received given current expected loss of AUM of approximately $3.0 billion.
“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. Their depth of talent will strongly complement our specialist teams,” AMP chief executive, Alexis George, is quoted saying in the filing.
“Discussions with interested parties on the sale of our international infrastructure equity business continue. Any decisions will be driven by our focus on delivering value for shareholders, leveraging the expertise of our investment teams and working closely with our clients to align an outcome that best supports them.”
As for Collimate’s remaining international infrastructure equity business, AMP confirmed it remains in discussions after receiving a number of approaches from parties interested in acquiring the business.
“AMP will continue these discussions with a focus on maximising the value for shareholders by achieving the best outcome for clients and other stakeholders,” the ASX listing reads.
Seems like a knockdown price, especially as AMP has effectively admitted that they are unlikely to receive the second payment of $300m