Colonial Acquires 15% Of Socimi Axiare For €136M

19 October 2016 – Expansión

Colonial is continuing with its investment policy. After spending €446 million on various purchases so far in 2016, it announced a new operation on Monday, this time with a financial component. The real estate company, chaired by Juan José Brugera (pictured above), has completed the acquisition of 15.1% of the share capital of the Socimi Axiare Patrimonio.

The operation has been closed at a price of €12.50 per share, above Axiare’s latest share price of €11.18 at the end of trading on Friday. Yesterday, the share price of the real estate company soared by more than 7% to close at €6.34 per share.

In total, Colonial has invested €135.58 million to acquire this 15.09% stake, which was previously held by the fund manager Perry Partners. That firm, which acquired its stake in Axiare in July 2014 when the Socimi debuted on the stock market, was the largest shareholder until now, with 19.9% of the share capital. Perry’s decision to sell forms part of its strategy to close its fund and has allowed it to generate juicy profits, given that it acquired its stake for €10/share.

Sources close to Axiare described the purchase as “very positive” and said that it reflects “confidence in the future of the company” given that the purchase price was higher than the average trading price.

Assets

As a result of this operation, Colonial has become the largest shareholder of a real estate company that has a very similar portfolio of assets to its own and at a time when the supply of prime offices in the market is scarce.

As at 30 June 2016, Axiare held assets worth €1,049 million, of which 68% related to offices, 19% to logistics assets and 13% to properties for commercial use. At a presentation to investors and analysts, Colonial explained the details of the operation, which it described as an “attractive option in the market” to acquire shares in a company “that specialises in offices” and whose asset value is mainly concentrated in Madrid and Barcelona (85%). (…).

During the first half of 2016, Axiare generated profits of €83.8 million, up by 168% compared to 2015, after it increased revenues by 27.6%.

During the same period, Colonial generated revenues of €137 million and profits of €230 million. Its portfolio was worth €7,556 million as at 30 June 2016.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

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