Dexus · ASX:DXS
Dexus — DEXUS Property Group — Merger or Acquisition (October 2013)
28 slides from Dexus's merger presentation, Oct 11, 2013
Slide 1: ASX release: Proposal to acquire Commonwealth Property Office Fund
DEXUS Property Group (ASX: DXS) ASX release 11 October 2013 Proposal to acquire Commonwealth Property Office Fund For personal use only Please refer to the attached presentation which provides further detail regarding today’s announcement relating to a Proposal to acquire Commonwealth Property Offic
Slide 2: Proposal to Acquire Commonwealth Property Office Fund (CPA)
DEXUS PROPERTY GROUP PROPOSAL TO ACQUIRE COMMONWEALTH PROPERTY OFFICE FUND (CPA) 11 OCTOBER 2013 For personal use only DEXUS Funds Management Limited ABN 24 060 920 783 DEXUS Property Group – Proposal to acquire Commonwealth Property Office Fund (CPA) Slide 1 AFSL 238163 as responsible entity for DE
Slide 3: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER For personal use only This presentation is issued by DEXUS Funds Management Limited (DXFM) in its capacity as responsible entity of DEXUS Property Group (ASX:DXS) (DEXUS) comprising DEXUS Diversified Trust (DDF), DEXUS Industrial Trust (DIT) DEXUS Office Trust (DOT) a
Slide 4: Agenda
AGENDA For personal use only Executive Summary 1. The Proposal 2. Rationale 3. Summary Appendices DEXUS Property Group – Proposal to acquire Commonwealth Property Office Fund (CPA) Slide 3
Slide 5: Executive Summary
EXECUTIVE SUMMARY TITLE SLIDE HEADER Sub title (Trebuchet 18 pt) For personal use only Presenter title DEXUS Property Group – Proposal to acquire Commonwealth Property Office Fund (CPA) Slide 4
Slide 6: Executive Summary: Proposal
EXECUTIVE SUMMARY Proposal For personal use only DEXUS and Canada Pension Plan Investment Board (CPPIB) (together the ―Consortium‖) have made an indicative, non-binding proposal (the ―Proposal‖), to the responsible entity of Commonwealth Property Office Fund (CPA), Commonwealth Managed Investments
Slide 7: Significantly increases DXS portfolio and total platform AUM
EXECUTIVE SUMMARY Significantly increases DXS portfolio and total platform AUM For personal use only Pro-forma DEXUS Property Group Platform1 $17bn AUM Office $11.5bn Industrial $2.5bn Retail $3.1bn Development pipeline $3.2bn DXS Portfolio2 Total Assets Under Management Pre Post Pre Post Mandate Au
Slide 8: 1. The Proposal
1. THE PROPOSAL TITLE SLIDE HEADER Sub title (Trebuchet 18 pt) For personal use only Presenter title DEXUS Property Group – Proposal to acquire Commonwealth Property Office Fund (CPA) Slide 7
Slide 9: The Proposal: Overview
THE PROPOSAL Overview For personal use only The Consortium has made an indicative proposal to the responsible entity of CPA to acquire all of the issued units in CPA, other than those to which DEXUS is already entitled1 — Offer comprises $0.680 in cash and 0.4516 DEXUS securities per CPA unit — He
Slide 10: Benefits to CPA Unitholders
THE PROPOSAL Benefits to CPA Unitholders For personal use only Opportunity to participate in the benefits associated with an investment in DEXUS — Ownership in a leading Australian office portfolio and established funds management platform — High quality management team and specialist office exper
Slide 11: Pro-forma impact on DEXUS key metrics
THE PROPOSAL Pro-forma impact on DEXUS key metrics For personal use only METRIC PCA FFO1 Gearing2 NTA IMPACT DXS FY14 PCA FFO per DXS gearing DXS NTA per security security guidance 2% - 2.5% increase1 4.5% - 5.5% increase 2% - 3% decrease Market guidance PCA FFO Post1 30 June 2013 Post 30 June 2013
Slide 12: 2. Rationale
2. RATIONALE TITLE SLIDE HEADER Sub title (Trebuchet 18 pt) For personal use only Presenter title DEXUS existing owned and managed portfolio and CPA portfolio - Sydney CBD, NSW DEXUS Property Group – Proposal to acquire Commonwealth Property Office Fund (CPA) Slide 11
Slide 13: Creates a market leading Australian office platform
RATIONALE Creates a market leading Australian office platform For personal use only DEXUS will become the largest owner and Australian office asset managers by AUM ($bn) manager of prime grade Australian office property 11.5 — $11.5 billion of office properties AUM — 1.5 million sqm of office spac
Slide 14: Scale in core markets
RATIONALE Creates a market leading Australian office platform – scale in core markets Sydney Brisbane For personal use only $5.6bn $1.2bn Office Assets Under Office Assets Under Management1 Management1 540,000sqm 138,000sqm Existing Office NLA2 Existing Office NLA2 17,000sqm 55,600sqm NLA NLA Under
Slide 15: Two complementary portfolios: enhanced diversity
RATIONALE Brings together two complementary portfolios – enhanced diversity in DXS office portfolio For personal use only Creates a highly diversified office platform Portfolio quality – office1 100% 13% 11% 13% — Provides enhanced diversification across assets, 80% tenants and markets 60% 48% 55%
Slide 16: Broader tenant exposure
RATIONALE Brings together two complementary portfolios – broader tenant exposure For personal use only Broadens DEXUS‘s exposure to quality, blue chip tenants, underpinning quality of earnings Strong tenant representation across S&P/ASX 100, government, legal and accounting firms Increased abi
Slide 17: Further enhances third party funds management platform
RATIONALE Further enhances strong third party funds management platform For personal use only Expands leading $6.1 billion third party funds management Funds under management $9 platform to $8 billion $8 $1.9bn $7 Executes on strategic objective to grow third party funds $6 $0.2bn $0.2bn $ billi
Slide 18: Leverages fully integrated office platform and experienced team
RATIONALE Leverages DEXUS‘s fully integrated office platform and experienced team For personal use only Fully integrated office management platform spanning asset management, leasing, development Internalised property platform enhances alignment of interests to drive optimal asset outcomes Stron
Slide 19: Operational and leasing synergies due to portfolio scale
RATIONALE Provides operational and leasing synergies due to portfolio scale For personal use only Enhances DEXUS‘s ability to deliver superior asset management results — Increased ability to accommodate current and future tenant needs — Improved customer experience from DEXUS‘s management model
Slide 20: 3. Summary
3. SUMMARY For personal use only DEXUS Property Group – Proposal to acquire Commonwealth Property Office Fund (CPA) Slide 19
Slide 21: Summary
SUMMARY For personal use only The Proposal, if implemented — Is in line with DEXUS‘s strategy — Delivers an attractive outcome for all stakeholders, in a timely manner with limited business interruption — Creates a market leading Australian office platform Post implementation of the Proposal, ne
Slide 22: Appendices
APPENDICES For personal use only DEXUS Property Group – Proposal to acquire Commonwealth Property Office Fund (CPA) Slide 21
Slide 23: Canada Pension Plan Investment Board (CPPIB)
CANADA PENSION PLAN INVESTMENT BOARD1 (CPPIB) For personal use only CPPIB is a leading global professional investment management organisation that invests the assets of the Canada Pension Plan (CPP) not currently needed to pay benefits With net assets of C$188.9 billion, including C$20.9 billion
Slide 24: Proposal Terms
PROPOSAL TERMS For personal use only Under the Proposal, DEXUS intends that the DEXUS Stapled Securities issued to CPA Unitholders will participate in the next distribution for the number of days they are on issue during the distribution period Any CPA Units which are issued to CPA convertible n
Slide 25: Basis of Preparation of Pro-forma Impact on Key Metrics
BASIS OF PREPARATION OF PRO-FORMA IMPACT ON KEY METRICS For personal use only The metrics are prepared on the basis of current guidance provided to the market by both CPA and DEXUS (refer to Slides 26 and 27) If the Proposal is implemented between the Consortium and CMIL, further information will be
Slide 26: Funds From Operations (FFO) Definitions
FUNDS FROM OPERATIONS (FFO) DEFINITIONS The Property Council (PCA) White Paper on FFO (―Voluntary Best Practice Guidelines for Disclosing Funds From Operations (FFO) and Adjusted Funds From For personal use only Operations (AFFO)‖) outlines voluntary guidelines to be used for calculating FFO. The in
Slide 27: Key FFO Assumptions
KEY FFO ASSUMPTIONS DXS Standalone For personal use only 19 August 2013 market guidance of 8.15 cents per security (cps) or 8.63 cps using the PCA FFO definition which adds back amortisation of rent-free periods Assumptions: — Delivering 2.5-3.5% like-for-like income growth across the DEXUS offi
Slide 28: Key Gearing and NTA Assumptions
KEY GEARING AND NTA ASSUMPTIONS Gearing Assumptions For personal use only Gearing is calculated as interest bearing liabilities (excluding deferred borrowing costs and including the fair value of cross currency swaps and post implementation of Proposal DXS‘s share of residual debt in unlisted fund
DEXUS Property Group — Merger or Acquisition (October 2013) on 6ix