MGP Announces proposed expansion to $1billion

The Directors of Macquarie Goodman (NZ) Limited (“MGNZ”), the manager of MGP, today announced a proposal to expand and enhance MGP’s asset base through the acquisition of a portfolio of high quality industrial and business space properties for $318.2 million (“Acquisitions”).

MGNZ’s Chairman, Hon. Jim McLay, said, “The primary benefits to Unitholders of the transaction include improving the quality and tenure of MGP’s portfolio, increasing MGP’s total assets to over $1 billion and, importantly, producing increased distributions.”

The Acquisitions will enhance MGP’s position as New Zealand’s premier industrial and business space property group and rank it as the second largest listed property trust and one of the top 25 entities on New Zealand Exchange (“NZX”).

The Acquisitions, to be acquired from Macquarie Goodman Group (“MGQ”) and its subsidiaries, comprise:

assets currently owned by MGQ (MGP to acquire a 100% interest);
Highbrook Business Park Stage One, East Tamaki (MGP to acquire MGQ’s 75% interest(1)); and
completed or commenced developments in which MGP already owns 50%.
(1) Property is currently owned by Highbrook Development Limited, which is 75% owned by MGQ and 25% owned by the nominee company of the estate of Sir Woolf Fisher. The estate is to retain its 25% interest.
The Acquisitions are at a price based on independent valuations and represent a weighted average capitalisation rate of 8.2%. (Further details of the Acquisitions are set out in Schedule 1).
John Dakin, Chief Executive Officer of MGNZ, said, “Over the past year, MGNZ has continued to deliver its strategy for MGP of acquiring premium properties, progressing the development pipeline and introducing and retaining high calibre customers.
The Acquisitions represent an opportunity to further implement this strategic approach with the introduction of a large scale portfolio of premium sector specific properties that would otherwise be difficult to replicate in one transaction.”

To partly fund the Acquisitions, MGNZ will undertake an Institutional Placement to raise $112.7 million and a Unit Purchase Plan (“UPP”) which will be available to all eligible Unitholders. The balance will be funded via new debt and a direct allotment of approximately $48 million of MGP units (“Units”) to MGQ, which will retain a significant cornerstone investment in MGP.
Transaction Benefits