Street Talk
Dexus makes first move on AMP Capital, sign of what's to comeSarah Thompson,
Anthony Macdonald and
Tim BoydSep 6, 2020 – 9.33pm
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Real estate investor Dexus is using its $10.7 billion unlisted Dexus Wholesale Property Fund to hunt down one of AMP Capital's flagship investment funds.
Darren Steinberg-run Dexus' play for an AMP Capital real estate fund is a sign of what's to come. Photo: Philip Gostelow
As Street Talk revealed on Saturday, Dexus has put a merger proposal to AMP Capital and some of its investors, seeking to take the rights to the AMP Capital Diversified Property Fund by merging with one of its own unlisted funds.
That fund is the Dexus Wholesale Property Fund, which invests across Australian office, retail and industrial property on behalf of 70 clients including Australian superannuation funds and other Australian and offshore institutions.
Combining the two would create a new $15 billion-plus fund with substantial stakes in property in Sydney, Melbourne, Perth, Brisbane, the Gold Coast and North Sydney.
It is understood Dexus has already obtained support from some of the $4.5 billion-odd AMP fund's investors, and has lobbed the merger proposal with the responsible entity, which is another AMP Capital subsidiary; AMP Capital Funds Management Ltd.
calling in investment bankers and putting its whole portfolio of assets under review last week.AMP Capital is expected to defend the move and has appointed Evans and Partners Corporate Advisory for help. Investors said it was up to the responsible entity to decide whether to grant Dexus due diligence.
While all the attention last week was on potential corporate transactions, Dexus' move shows AMP and AMP Capital also have their work cut out to preserve funds. AMP Capital has $192.4 billion in assets under management.
If AMP Capital has happy investors in its funds, it has little to worry about. If not, then funds can pretty quickly be placed with new managers, as seen at Westpac-owned Hastings Funds Management in recent years, when its two big infrastructure funds were
picked off by Morrison & Co and
Macquarie's MIRA, respectively.
(20min delay)