Augusta Capital Ltd has forfeited the $4.525 million deposit on its failed purchase of the Albany Lifestyle Centre but has won an extension of settlement on a second property intended for the new Augusta Property Fund.
However, if Augusta doesn’t settle that second purchase, it stands to lose another $4.49 million, which would take losses on the unopened fund to $8.715 million.
Over the last 4 weeks, Augusta’s share price has risen from 81c on 3 April to 90c on 21 April, and was back down at 82c yesterday. The shares plunged from a peak of $2.175 on 20 February.
The debts stopped with NZX-listed Augusta instead of being passed through to the property fund after the company pulled the fund’s initial public offering on 27 March.
Augusta chair Paul Duffy & managing director Mark Francis said yesterday the company had negotiated an extension of the settlement date with the vendor of the Anglesea Medical Centre in Hamilton, to 30 September.
“If settlement does not occur, Augusta’s liability is capped at a maximum of $1.74 million, in addition to the $2.75 million deposit that has already been paid. The previously paid deposit (which has been held by the vendor’s solicitor) is immediately released to the vendor. The purchase price under the agreement remains the same. The variation is conditional on the approval of the vendor’s shareholders (by special resolution), which is due to be satisfied by 15 May.”
Mr Duffy & Mr Francis added: “Augusta is now progressing work to offer the property for investment again.”
Augusta was buying the Albany Lifestyle Centre on Oteha Valley Rd from Argosy Property Ltd to anchor the new property fund but, after Augusta failed to settle, Argosy cancelled the agreement.
“While Augusta was not a party to that agreement, it had funded payment of the $4.525 million deposit (which was to be reimbursed by the Augusta Property Fund once established). As a result of the cancellation of the contract, the $4.525 million deposit has been forfeited,” Mr Duffy & Mr Francis said.
28 March 2020: Augusta pulls Albany purchase, but property fund may be revived
27 March 2020: Augusta pulls property fund IPO
27 March 2020: Centuria ends Augusta bid
18 March 2020: Asset Plus pulls rights issue
11 March 2020: Asset Plus announces rights offer, Augusta to cut its stake
17 February 2020: Augusta defers tourism fund, expects earnings cut
7 February 2020: Augusta launches new fund next week
24 May 2019: Augusta buys Albany Lifestyle Centre from Argosy for new fund
Attribution: Augusta release.