Augusta collects $2.7m from syndication, fund offers
The company's $17 million syndicate to buy and redevelop Oji Fibre Solutions' Penrose premises was fully subscribed.
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Hawke’s Bay
Augusta Capital [NZX: AUG] says it generated fees totalling $2.7 million after successfully completing separate syndication and property fund offers.
The Auckland-based company's $17 million syndicate to buy and redevelop Oji Fibre Solutions' Penrose premises was fully subscribed, meaning Augusta didn't need to take up any underwritten amount, it said in a statement. Separately, it closed a $60 million offer for Augusta Value Add Fund No 1, housing property assets worth $112 million, taking up $9.51 million. Augusta plans to onsell $3.51 million of that stake to investors who hadn't been able to meet the April 1 settlement date, due to anti-money laundering due diligence or being unable to transfer funds.
Augusta receives offeror and underwriting fees of about $1.4 million from the Oji syndication deal, plus a further $300,000 project management fee payable once the site is developed, while the fees generated from the Value Add fund's offer and underwrite amount to almost $1.4 million. Augusta will also attract an annual management fee of 1.25% from the fund, worth $1.4 million at the fund's current assets, reducing by 25 basis points on the sale of each property, with a base management fee of $400,000, plus a performance fee of 20% when the pre-tax internal rate of return beats an annual 8%.
Funds management generated net revenue of about $4.6 million in Augusta's first half, ahead of the $3.3 million from investment property. The company diversified into funds management away from pure property ownership as a means to generate more income from its investments.
The shares rose 1% to $1.04 and have gained 3% this year.
(BusinessDesk)
Paul McBeth
Thu, 31 Mar 2016
Thu, 31 Mar 2016
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