ASX-listed Dexus has announced its $10-billion Dexus Wholesale Property Fund will merge with AMP Capital's Diversified Property Fund in a “strategic fit” for the funds' existing portfolios.
The implementation agreement between Dexus Wholesale Property Fund (DWPF) and AMP Capital Diversified Property Fund (ADPF) will combine the two entities under a stapling agreement which includes exclusivity arrangements.
Dexus CEO Darren Steinberg said he was pleased to make progress on the proposed merger.
“This merger delivers further economies of scale from management, procurement and leasing perspectives across the platform and is strongly aligned with our objective of being the wholesale partner of choice,” Steinberg said.
DWPF fund manager Michael Sheffield said it was a “strategic fit with DWPF’s existing portfolio” providing additional exposure to premium real estate assets.
“The ability to merge this portfolio in a cost and capital efficient manner enables us to create a combined entity which delivers strong benefits to investors,” Sheffield said.
Dexus executive general manager of funds management Deborah Coakley said Dexus had a track record of supporting the investment strategies of capital partners, and that they would be adding further value to the merged portfolio.
AMP’s $5-billion ADPF real estate portfolio includes investments across office, retail and industrial sectors. Key assets include Quarry Quarter Tower, Westfield Booragoon and Westfield Warringah Mall.
A unit-holder vote on the merger is expected in late April. If the merger is approved by responsible entities and their unit holders’ votes it will diversify DWPF’s existing wholesale institutional investor base through the introduction of new investors.