Published 10 December 2006
Investment & advisory firm Babcock & Brown and real estate group the GPT Group, both based in Sydney, withdrew their proposed listed pan-European retail property fund on Thursday, saying the proposed initial public offering “would not have sufficiently realised the full value of the initial portfolio”.
The fund, announced on 21 November, was to have been managed by their joint venture.
They said they could achieve a better outcome through other capital-raising & structuring options, including through the syndication of equity in the portfolio assets to the direct investment market and/or the creation of a more simplified reit structure, taking advantage of the introduction of new legislation in specific European markets.Babcock & Brown chief executive Phil Green said: “We are very confident of the high quality & values of the properties in the portfolio. In light of the market’s response to the proposed IPO, and given the depth of the direct market interest in quality assets with a strong defensive cashflow profile such as these, we will pursue alternative options and expect to see the assets bedded down in a long-term managed structure during 2007.”GPT chief executive Nic Lyons said: “The withdrawal from the IPO process does not alter the joint venture’s strategy to create & grow a funds management business. This move simply reflects both GPT and Babcock & Brown’s determination that an IPO at this time was not going to achieve an optimal outcome for the joint venture in the proposed structure. We continue to work on a number of initiatives within the joint venture and remain focused on the creation of long-term enterprise value.”
Attribution: Company statement, story written by Bob Dey for this website.