Sydney-based fund manager AIMS Financial Services Group and its affiliates have proposed to buy out its partner’s 50 per cent stake in the management entities of AIMS AMP Capital Industrial REIT (AA REIT), it said in a statement on November 21.
The partner is AMP Capital, which also owns a 10.26 per cent stake in the units of AA REIT. Once the transaction is completed, AIMS Financial will become the 100 per cent owner of the management entities of AA REIT holding 17.88 per cent of AA REIT units.
No financial details were disclosed.
The management entities of AA REIT include AA REIT’s manager AIMS AMP Capital Industrial REIT Management; AIMS AMP Capital Industrial REIT Management Australia as its investment manager; and AIMS AMP Capital Property Management as the property manager.
The acquisition, which is expected to complete in December, follows AMP Capital’s announcement in March that it was undertaking a review of its ownership interests in the management entities of AA REIT as well as its principal stake in AA REIT.
“AIMS has enjoyed a successful partnership with AMP Capital over the last nine years, and we now look forward to this next chapter in the evolution of AA REIT. Our footprint across Asia Pacific and extensive track record in managing real estate investments strongly positions AIMS Financial Group to ensure AA REIT continues to deliver stable and sustainable long-term returns to unitholders,” said AIMS Financial Group chairman and CEO George Wang.
AIMS Financial Group acquired MacarthurCook in July 2009, the parent company of MacarthurCook Industrial REIT (MI-REIT), the predecessor of AA REIT. At that time, MI-REIT was facing several financial challenges and had a depressed market capitalisation of S$60 million ($43.7 million) with AUM at around S$544 million ($396.3 million).
Since the takeover by AIMS Financial Group, a recapitalisation exercise took place with MI-REIT raising equity to repay and refinance debt facilities and fund the acquisition of four properties from AMP Capital, resulting in a turnaround for the REIT.
In March 2010, MI-REIT’s market capitalisation increased to S$315 million ($230 million) and it gained the support of AMP Capital, which entered into a joint venture with AIMS Financial Group as sponsors of the REIT and underwent a rebranding exercise from MI-REIT to AA REIT.
AA REIT has since grown its AUM to close to S$1.5 billion ($1.1 billion) through acquisitions, strategic asset enhancement and development projects. Its portfolio consists of 26 industrial properties in Singapore and Australia.