This article is from the Australian Property Journal archive
LEND Lease is believed to be have teamed up with New York based investment firm NRDC Equity Partners LLC to launch a $13 billion bid for Centro Properties, according to reports.
The Wall Street Journal said the partners have offered Centro $13 billion.
Lend Lease and NRDC Equity will likely split the assets, with Lend Lease taking the Australian portfolio and NRDC Equity acquiring the US properties.
Centro has $18.6 billion worth of investment properties totalling 712 shopping centres in Australia, New Zealand and the US. The vast majority of the shopping centres are owned by Centro’s managed funds.
Approximately 60% of the portfolio by value is located in the US.
But the $13 billion bid is considered opportunistic and if the deal does go ahead, it will leave Centro with a shortfall of $4 billion to repay back to its lenders.
Centro currently owes $17 billion in debt.
Any successful transactions will not immediately deliver returns to the ordinary “mum and dad” shareholders, because as part of the Stabilisation Agreement Centro signed in December 2008, Centro would ultimately hand over 90.1% control of the group to the banks.
Analysts said this formal sale process is likely a result of Centro’s lenders, which avoided having a fire sale during the global financial crisis to protect asset prices. However they are now looking to cash in the properties because market conditions are improving.
Australian Property Journal
