Centuria Capital Steps Forward on Takeover Offer for Kiwi Property Manager, Augusta Capital

  • July 09, 2020 08:23 PM NZST
  • Team Kalkine
Centuria Capital Steps Forward on Takeover Offer for Kiwi Property Manager, Augusta Capital

Summary

  • Centuria Capital’s takeover bid for Augusta is now unconditional, with Augusta shareholders to receive NZ$ 0.22 in cash along with 0.392 Centuria stapled securities for each Augusta share.
  • Acceptances to Centuria’s full takeover offer signify almost 65.86 per cent of Augusta’s shares including Centuria New Zealand’s existing 23.3 per cent shareholding.
  • On offer completion, assets under management (AUM) of Centuria to increase by 24 per cent to A$ 8.9 billion.
  • Following this takeover, the enlarged group would represent one of the leading funds management platforms in Australasia with ~NZ$ 9.5 billion in AUM.

ASX-listed specialist investment manager Centuria Capital Group (ASX: CNI) has declared its takeover offer for Kiwi property funds manager Augusta Capital Limited (NZX: AUG) as unconditional, with full takeover acceptances representing more than 65 per cent of Augusta’s shares.

Let us delve deep and discuss the significant market update in detail-

Augusta Capital Takeover Bid Now Unconditional

On 8 July 2020, Centuria Capital Group, through its 100 per cent owned subsidiary, Centuria New Zealand Holdings Limited declared its complete takeover offer as unconditional for Augusta Capital. The takeover offer was opened on 29 June 2020 and since then, the New Zealand subsidiary has acceptances that along with its existing shareholdings in Augusta represent 65.86 per cent shares of the latter.

Commenting on the development, John McBain, Joint CEO Centuria said-

Mr. McBain highlighted Augusta Capital as a substantial player in the New Zealand market with a highly efficient team, adding that Centuria foresees New Zealand to be an essential growth engine within its platform.

Takeover Offer Details

During mid-June 2020, Centuria Capital Group submitted a formal takeover notice in New Zealand for acquiring all of the wholly paid ordinary shares in Augusta Capital Limited that were not owned by Centuria, for an implied value of NZ$ 130.1 million.

According to this offer, in exchange for their Augusta shares, shareholders of Augusta will obtain NZ$ 0.20 in cash per share, and 0.392 Centuria securities for each Augusta share they own.

However, at end-June, Centuria New Zealand revised its offer by increasing the cash component to NZ$ 0.22 from NZ$ 0.20 per Augusta share, with the scrip component remaining unchanged at 0.392 Centuria stapled securities per Augusta share.

As of 8 July 2020, acceptances of the offer, together with existing shareholding of Centuria, represent 65.86 per cent of Augusta’s shares. The upsurge in cash component of the offer was notified to Augusta shareholders by the NZ subsidiary of Centuria Capital, with the shareholders giving their consent to this offer to receive a higher cash component.

Benefits of This Takeover to Centuria

According to the Company’s Investor Presentation dated 15 June 2020, the transaction would result in following benefits for new and existing securityholders:

  • With this transaction, Centuria Group’s assets under management (AUM) would increase by 24 per cent to A$ 8.9 billion.
  • The takeover offer would enhance Centuria’s presence as a leading funds manager across New Zealand and Australia.
  • Centuria would become one of the largest fund managers across New Zealand in a globally recognised, comparable real estate market to Australia. Following the offer, Australian real estate exposure represents ~78 per cent of Centuria’s platform.
  • The complementary platform of Augusta is highly aligned to Centuria’s sectors of expertise, and this would help Centuria to grow, as it broadens sector diversification.

Source: CNI Presentation

Key Reasons for Augusta Capital to Accept the Offer

  • The implied offer price signifies an appealing premium to key metrics, and the offer is supported by Augusta’s founding shareholders and other shareholders.
  • The expanded group would represent one of the leading funds management platforms in Australasia with ~NZ$ 9.5 billion in AUM. Centuria has an outstanding track record of AUM growth and has delivered exceptional returns to investors and progressively increased distributions.
  • Moreover, Centuria intends to work with the management team of Augusta to grow Augusta’s business actively.

About Centuria Capital Group

With a 35 year-track-record of providing a range of products and services, ASX-listed specialist investment group Centuria Capital Group (ASX:CNI) serves investors, advisers and securityholders. The Company offers several investment opportunities that include listed as well as unlisted real estate funds and tax-effective investment bonds.

Its vision is to continue to build a leading listed real estate funds management platform and achieve top three Australian ranking.

About Augusta Capital Limited

Founded in 2001, NZX-listed Augusta Capital Limited (NZX:AUG) actively manages assets of NZ$ 1.8 billion, as of 26 June 2020. As a property funds management business, AUG is engaged in the acquisition of assets in a range of property sectors such as retail, office, tourism, and industrial properties across New Zealand and Australia. The Company is one of the prominent property funds management specialists in New Zealand.

Growth strategy of Augusta is supported by an active management approach, where the scale and diversity of the offerings continue to grow, as the Company further enhances its funds under management.

Source:Augusta Capital Limited

Stock Information (ASX: CNI)- On 9 July 2020, CNI stock closed the day’s trade flat at A$ 1.735. The market cap of Centuria Capital Group stood at A$ 838.14 million with nearly 483.08 million shares trading on ASX. In the last three months, CNI has delivered a positive return of 6.44 per cent.

Stock Information (NZX: AUG)- On 9 July 2020, AUG stock last quoted at NZ$ 0.940, up by 0.53 per cent from its previous close, with a market cap of NZ$ 159 million on the New Zealand Stock Exchange.

 

 


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