Investors send message, throw spanner in deal
Property group Mirvac has won control of AMP’s $7.7 billion wholesale office fund, dashing the global investment manager’s hopes for a clean exit from its Collimate Capital business.
Mirvac won a vote on Monday and will take over the running of the AMP Capital Wholesale Office Fund (AWOF), The Australian reported. Mirvac won about 60% of the vote after building support from key superannuation fund investors. About 29% of investors voted against Mirvac, while others abstained.
Wholesale investors forced the meeting in May, a month after Dexus purchased Collimate’s then-$28 billion local real estate and infrastructure funds for $250 million. The Australian reported in April that Mirvac would attempt to intervene in the management of the office trust. The AWOF owns stakes in key skyscrapers, including Sydney’s Quay Quarter Tower. It also owns stakes in 33 Alfred Street and major buildings in Melbourne, the publication reported.
The loss of the fund from the Collimate stable throws a spanner in plans to transfer management to Dexus. The loss of the office trust, along with a separate $3 billion mandate for UniSuper to GPT, means that only $20.2 billion will be shifted to Dexus, The Australian reported.
The vote to hand the office fund over to Mirvac was in part a repudiation of AMP’s decision to scrap a planned spin-off of Collimate in favour of a sale, as well as an investor backlash against longstanding governance issues, The Australian reported.
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Dexus is protected, as it will not have to pay the earn-out provisions relating to AWOF. Dexus is focused on using the Collimate deal to step into the infrastructure space.
The deal means that Mirvac’s capital under management will skyrocket 76% to $18.1 billion, The Australian reported. Mirvac CEO Susan Lloyd-Hurwitz said that acquiring the AMP fund was an “acceleration of Mirvac’s long-stated strategy to grow our third-party funds under management with aligned capital partners.” She said the deal “further enhances our position as a top-tier manager of prime office assets in Australia.”
“We are pleased to offer AWOF unitholders reduced fees, a standalone trustee with a majority independent board and access to Mirvac’s market-leading, integrated asset creation and curation capabilities and platform, including our $9.2 billion office and mixed-use development pipeline,” Lloyd-Hurwitz said.
