Augusta to buy biggest rival
NZX-listed Augusta Capital has taken a large slice of the property funds management market, after announcing its purchase of KCL Property and Investment Property Titles.
Augusta will buy its biggest rival, KCL Property, for $15 million in cash and scrip, and will pay $444,000 to Bayleys for IPT.
The deal will raise Augusta's property portfolio to 170 properties and boost the value of its funds under management from $350m to $1.2 billion.
General manager Mark Francis said the move would add revenue, but also open opportunities in Australia through KCL Property's Australian business.
Augusta also announced an alliance with real estate company Bayleys, including a joint venture to offer new property funds, both listed and unlisted.
Francis said the two companies felt there was space in the market for more multi-asset and sector-specific property funds.
Bayleys would also become its exclusive partner for the selldown of all Augusta's future syndicated properties.
Francis said there were no plans to raise any further capital. Augusta's gearing would sit at about 37 per cent after the transaction and the prospective sale of its Bunnings property in Silverdale.
Augusta Capital also confirmed it would increase its cash dividend by 1 cent to an annualised 5c per share from its June quarter.