silverfox
Well-Known Member
Property funds manager Valad Property Group is to acquire UK-based funds manager Scarborough Property Holdings for an enterprise value of $2 billion.
The Australian company also is raising $1.2 billion to help fund the acquisition, which includes property and funds managers in a range of European countries, and may buy more assets in Japan.
Privately owned Scarborough Property Holdings is part of Scarborough Development Group, founded in 1980 by Sheffield United football club chair Kevin McCabe.
Valad earlier had flagged its wish to move further into the European property market. This year, it's acquired European assets through investing in Crownstone European Properties Ltd.
The Scarborough purchase would take Valad's assets under management from $6.6 billion to $16.8 billion.
Before this morning's announcement, Valad had its securities placed in a trading halt.
In a briefing today, Valad executive chairman, Stephen Day, said the move represented Valad delivering its European expansion strategy.
"This is a continuation of a growth strategy outlined ... over the last 18 months," he said.
"Scarborough is a lot like Valad," he said, describing the target as "a European Valad with the same breadth and depth of operations as Valad has in Australasia".
"A key attraction is the really strong cultural fit, with people in both businesses."
Mr McCabe said Scarborough had been looking for a partner for some time.
"The shape and structure of Valad is in so many ways similar to our own," he said.
Valad's executive director of global transactions, Peter Hurley, who would move to London to oversee the European operations, said the main attraction of the acquisition was the skilled management in the group across the continent.
"I have been looking in Europe for the past 18 months. I looked at a lot and I said no to plenty," he said.
"Scarborough has a pan European network ... The real opportunity is that they have got teams who have got the asset management skills.
"Through those teams we can build on property sectors in those countries."
Scarborough owns eight properties and operates in eleven European countries, including France, Germany, Denmark, Poland, the Czech Republic and Romania.
The portfolio includes industrial and retail property.
Scarborough's enterprise value, which includes debt, is $2 billion, with $10.2 billion of assets under management, Valad said today.
Australian property companies, such as Macquarie Office Trust, this year have been moving to snap up property in Europe and Japan, two regions at the bottom of their property cycle and on the way up, as funds managers seek new homes for some of Australia's $1 trillion-plus in superannuation funds.
As part of the capital raising, Valad's new securities will have an application price of $1.92, a discount of 7.7 per cent to the five-day average price, adjusted for a June distribution of 5.67 cents.
Valad said it expected distributions per security to rise 12.9 per cent in fiscal 2008.
The Australian company also is raising $1.2 billion to help fund the acquisition, which includes property and funds managers in a range of European countries, and may buy more assets in Japan.
Privately owned Scarborough Property Holdings is part of Scarborough Development Group, founded in 1980 by Sheffield United football club chair Kevin McCabe.
Valad earlier had flagged its wish to move further into the European property market. This year, it's acquired European assets through investing in Crownstone European Properties Ltd.
The Scarborough purchase would take Valad's assets under management from $6.6 billion to $16.8 billion.
Before this morning's announcement, Valad had its securities placed in a trading halt.
In a briefing today, Valad executive chairman, Stephen Day, said the move represented Valad delivering its European expansion strategy.
"This is a continuation of a growth strategy outlined ... over the last 18 months," he said.
"Scarborough is a lot like Valad," he said, describing the target as "a European Valad with the same breadth and depth of operations as Valad has in Australasia".
"A key attraction is the really strong cultural fit, with people in both businesses."
Mr McCabe said Scarborough had been looking for a partner for some time.
"The shape and structure of Valad is in so many ways similar to our own," he said.
Valad's executive director of global transactions, Peter Hurley, who would move to London to oversee the European operations, said the main attraction of the acquisition was the skilled management in the group across the continent.
"I have been looking in Europe for the past 18 months. I looked at a lot and I said no to plenty," he said.
"Scarborough has a pan European network ... The real opportunity is that they have got teams who have got the asset management skills.
"Through those teams we can build on property sectors in those countries."
Scarborough owns eight properties and operates in eleven European countries, including France, Germany, Denmark, Poland, the Czech Republic and Romania.
The portfolio includes industrial and retail property.
Scarborough's enterprise value, which includes debt, is $2 billion, with $10.2 billion of assets under management, Valad said today.
Australian property companies, such as Macquarie Office Trust, this year have been moving to snap up property in Europe and Japan, two regions at the bottom of their property cycle and on the way up, as funds managers seek new homes for some of Australia's $1 trillion-plus in superannuation funds.
As part of the capital raising, Valad's new securities will have an application price of $1.92, a discount of 7.7 per cent to the five-day average price, adjusted for a June distribution of 5.67 cents.
Valad said it expected distributions per security to rise 12.9 per cent in fiscal 2008.
