Aviva Investors intends to appoint Hansteen Holdings as asset manager on the Ashtenne Industrial Fund (AIF), replacing Warner Estate Holdings.
This follows the intended appointment of CCW Recovery Solutions as administrator of Warner and the planned sale of Warner‘s asset management business to Hansteen.
As part of the new agreement, it is proposed that Hansteen will take a 26.3 per cent stake in the AIF. This includes the proposed purchase of Warner’s current 5.3 per cent stake and a further investment of GBP42.5m in new units.
Existing AIF unitholders will also have the opportunity to subscribe for a further GBP7.5m of new units through an open offer.
Unitholders will shortly be sent details of the proposals, which are subject to a vote requiring 75 per cent approval at an extraordinary general meeting to be held on 12 September. Irrevocable undertakings and letters of intent to support the proposals have already been received from 83 per cent of unitholders eligible to vote at the EGM.
Hansteen will also become asset manager to AIF’s joint venture with the Homes and Communities Agency and Aviva Investors’ APIA Fund, which are also currently managed by Warner.
Andrew Appleyard of Aviva Investors says: “Over the past few months we have carefully considered the options available to the Fund given the financial position of Warner. The proposal for Hansteen to take over as asset manager and become a significant investor will provide a number of benefits, including:
· Continuity of property management services through an orderly transfer of Warner’s asset management business to Hansteen, an experienced and well-resourced industrial property manager.
· The injection of GBP50m of new equity into the AIF on market terms, which is not materially value-dilutive to unitholders, and will be used to repay debt. This will reduce the fund’s leverage to below 50 per cent LTV and facilitate the resumption of material dividends to unitholders.
· Alignment of interest between Hansteen and existing unitholders. As both asset manager and a significant unitholder, Hansteen will work to deliver value for all investors through a focused strategy of maximising income and selective disposal of non-core properties.”