Cromwell sells European fund management platform to Stoneweg for $457 million

Cromwell Property Group has agreed to sell its European fund management platform and interests, including Cromwell European REIT, to Swiss investment firm Stoneweg for 280 million euros ($457 million) as it moves ahead with plans to simplify its business and move to a less capital-heavy model.

The deal marks the end of a $1 billion divestment program that will cut gearing by 25 percent as Cromwell focuses on its Australia and New Zealand business, which has A$4.8 billion ($3.2 billion) of assets under management, the Brisbane-based group said on Thursday. in release.

Cromwell, whose two largest shareholders include Hong Kong-listed property giant ESR and the family of mainland Singaporean tycoon Gordon Tan, reported a loss of A$240.2 million in the six months to the end of December. A dollar loss was recorded. Real estate valuation.

“In the current operating environment, we considered a number of options to simplify our business and reduce risk, and this transaction provides us with the debt reduction needed to move forward in a focused and value-creating manner,” Cromwell said. I believe that we will be able to obtain working capital.” Chairman Gary Weiss.

CEREIT team keeps moving

Led by founder and CEO Jaume Sabater, Stoneweg believes in the quality of Singapore-listed Cromwell European REIT’s portfolio and the high risk it expects to create under its new sponsorship. He said he was attracted to the adjusted earnings.

In return, Stoneweg will acquire Cromwell’s entire 27.79% stake in CEREIT and 100% of the Australian group’s stake in a Singapore-based asset manager and a European asset manager, as well as other related joint ventures. You will receive an investment. CEREIT’s €2.2 billion portfolio consists of more than 100 assets in Europe’s major metropolitan areas.

There will be no changes to CEREIT’s independent directors and management team, the trust’s manager said on Thursday. In a separate statement.

Simon Garing, CEO of the manager, said: “We are pleased that Jaume and his team share our belief in the quality and value of CEREIT’s portfolio, as well as its growth prospects and potential.”

The 280 million euro deal covers all elements of Cromwell’s European business except the six-asset Cromwell Poland Retail Fund, which was the subject of a separate sale to Star Capital Finance for 285 million euros ($465 million). Completed on May 15th.

Doubled in size

Founded in 2015, Stoneweg is a Geneva-based real estate asset management and investment advisory group. The deal with Cromwell will double the firm’s assets under management to 8 billion euros, it said on Thursday. in release.

“This landmark transaction immediately creates a large-scale pan-European real estate asset management platform and continues our track record of successful transactions to deliver value to investors,” Sabater said.

Once the acquisition is completed, the Swiss fund manager will become CEREIT’s largest unit holder, with Gordon Tan’s family holding more than 9% of the shares.

The deal is subject to regulatory approval in Singapore and Luxembourg, where the acquiring Stoneweg fund is based.Cromwell shares rose 8 percent on news of the sale to close at A$0.47 per share on Thursday, while its CEREIT unit fell 0.7 percent to 1.47 euros.