ARA Asset Management has obtained a 15-percent stake in Australia’s struggling funds management provider APN Property Group.
ARA, a real-estate funds manager affiliate of Cheung Kong Group, is listed on the Singapore Stock Exchange with a $638 million market capitalisation.
APN, whose three funds have been frozen since October 2008, has issued 20,964,343 new shares at 22 cents per share to an ARA entity in a $4.6-million raising. APN said the money will be used to fund its new business opportunities.
Under the agreement, ARA will give capital to APN, which has agreed to pay US$150,000 ($169.588) through its subsidiary APN Funds Management Ltd to acquire ARA Strategic Capital, the manager of ARA Asian Asset Income Fund.
Mr. David Blight, chief executive and managing director of APN Property Group, said the management of the Asian Asset Income Fund would provide the group an opportunity to extend its real estate securities business across Asia. He added that ARA’s introduction as a strategic investor was thought to bring in long-term benefits beyond the initial placement.
“ARA’s platform throughout Asia, together with its proven ability to identify, acquire, manage and structure real estate investment vehicles will help APN Property Group progressively grow its real-estate securities business into the region,” said Mr. Blight.