BREAKING NEWS
Horror director Wes Craven has died age 76 ... More soon
Close

Commonwealth Bank sells down KIPT

LAURA WALTERS
Last updated 11:01 16/12/2013

Relevant offers

Industries

'Some industries dominated by women': John Key on midwives' pay Council consultant to scope science research Finance diary Firms lose $150 million from workplace sick days Shopkeepers lament creative change Petal power drives the Flower Project Creative solutions come from banana shortage Calls for Kiwis stuck in rent trap to be given incentives to save Ask the Expert: Getting past the steeper stairs of growth Capturing tax dollars from internet advertising a long haul

Commonwealth Bank of Australia (CBA) is reducing its holding in Kiwi Income Property Trust (KIPT) .

The NZX-listed property trust, said in a market announcement this morning that CBA had appointed Goldman Sachs to sell down its holding.

The Australian bank owned about 8.6 per cent of the trust's units through subsidiaries and also held KIPT's management contract.

Last week KIPT unitholders voted overwhelmingly to bring the trust's management back in house.

KIP's units were placed in a trading halt this morning and would not trade for the rest of the day so the sell-down could occur in an "orderly fashion", KIPT said.

The sell-down will terminate CBA's management contract and cost $70m. However, KIPT expects the buyout will save it $8m a year. The trust will be managed by Kiwi Property Management (NZ), a newly established company controlled by unitholders.

Trust manager chairman Mark Ford said that management would be on a break-even basis.

Unitholders also agreed to increase directors' total fees to $585,000 a year and raise the amount the trust can borrow to 45 per cent of the fund's gross value.

KIPT's units last traded at $1.10, 3.9 per cent lower than a year ago.

KIPT holds a $2.1 billion portfolio that includes Wellington's Majestic Centre.

Ad Feedback

- Fairfax Media

Special offers

Featured Promotions

Sponsored Content