- Australian property investor Centuria Capital (CNI) is launching its second attempt to buy New Zealand real estate fund manager, Augusta Capital
- Earlier in January, Centuria originally offered NZ$174 million (roughly A$162.55 million) to buy Augusta in full
- Currently, Centuria holds a 23.3 per cent stake in Augusta
- Centuria is now returning with a lower bid of NZ$130 million (around A$122 million) since Augusta’s share price has lowered from January
- Centuria already has commitments from significant Augusta shareholders, representing 42.2 per cent of shares on issue
- Shares in Centuria lowered by 1.65 per cent over Monday trade, closing at $1.79 each
Property investor Centuria Capital (CIN) is launching its second attempt this year to acquire New Zealand real estate fund manager, Augusta Capital.
As of now, Centuria holds 23.3 per cent in the New Zealand company. However, the Australian company originally launched a NZ$174 million (roughly A$162.55 million) bid in late January for full ownership.
At the time, shares in Augusta were valued at NZ$1.76 (roughly A$1.66) — making Centuria’s bid worth NZ$2 (around A$1.87) per Augusta share.
Since then, Augusta’s share price on the New Zealand Exchange has substantially lowered to NZ$0.9 (approximately A$0.85) each.
Now that Augusta’s share value has lowered, Centuria is returning for a second attempt to acquire the company for NZ$130 million (around A$122 million).
“An acquisition of the remaining interest in Augusta is consistent with our strategy and the two groups are extremely compatible,” Centuria Joint Chief Executive, John McBain said on Monday.
“This strategy is based on a positive post-COVID-19 outlook and Centuria will benefit greatly from a 24 per cent increase in [worth of assets] as well as a broad Australasian footprint”.
A forecasted 24 per cent increase in Centuria assets, if the deal is successful, would signal A$8.9 billion in assets under management.
Centuria management plans to fund the deal through scrip and existing cash reserves.
Augusta shareholders who accept the offer would receive NZ$0.20 (about A$0.19) and 0.39 in Centuria securities per share.
Reportedly, Centuria’s initial offer to buy up Augusta was railroaded by the COVID-19 pandemic. As New Zealand is one of the early countries to lift its business and social restrictions, Centuria saw the opportunity to return for another bid.
“Recently, the Augusta Board and management team took decisive action to minimise the impact of COVID-19 by significantly reducing corporate debt and releasing surplus cash to aid growth in the core businesses,” John McBain added.
“Accordingly, its NZ platform is now well placed to take advantage of opportunities as COVID-19 unwinds,” he continued.
Centuria’s offer is already supported by founding Augusta shareholders, Managing Director Mark Francis, and fellow founder Bryce Barnett — representing 42.2 per cent of Augusta shares on issue.
Shares in Centuria Capital fell 1.65 per cent over Monday trade, closing at $1.79 each.