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Augusta Capital [NZX: AUG], the New Zealand listed property investor and fund manager, will buy property investors KCL Property and Investment Property Titles for $15.4 million in cash and scrip, to boost their portfolio and expand into Australia.
The Auckland-based company will buy the KCL business from Bryce Barnett, Phil Hinton and Cheryl Macaulay for $10 million in cash and $5 million in Augusta shares, giving the KCL shareholders about 7.1 percent of the enlarged group. The IPT business is being bought from real estate group Bayley Corp. for $444,000.
The shares gained 4 percent to 79 cents, valuing the company at $64.2 million.
As part of the deal, which is expected to settle on April, Barnett and Hinton will join the Augusta executive team, and Barnett will also join the board.
"The deal is expected to be significantly EPS (earnings per share) enhancing for Augusta Capital," the company said in a statement. "The move brings additional sources of revenue to Augusta alongside trans-Tasman expansion opportunities as a result of KCL Property's Australian business."
Once completed, Augusta will manage about 170 properties, and have some $1.2 billion in funds under management.
Augusta has also entered into a deal with Bayley where the listed company will become the exclusive partner for Bayley for all future funds management initiatives, including managed property offers to the market.