Amp Limited · ASX:AMP
Amp — AMP Office Trust — Merger or Acquisition (March 2000)
27 slides from Amp's merger presentation, March 2000
Slide 1: Acquisition of Darling Park by General Property Trust & AMP Office Trust
Acquisition of Darling Park by General Property Trust & AMP Office Trust March 2000 MARCH 2000
Slide 2: Contents
DARLING PRES - WEB SITE VERS.DOC Contents SECTION 1 The proposal _________________________________________ 1 SECTION 2 Acquisition fundamentals_______________________________ 6 SECTION 3 Impact analysis for AOF _______________________________ 12 SECTION 4 Timetable __________________________________
Slide 3: Disclaimer
DARLING PRES - WEB SITE VERS.DOC Disclaimer This presentation has been prepared by AMP Asset Management Limited ("AMPAM"), Warburg Dillon Read Australia Corporate Finance Limited ("WDR") and ABN Amro Corporate Finance Australia Limited ("ABN"). It is for informational purposes to enable the recipien
Slide 4: The proposal
The proposal SECTION 1 ABN-AMRO
Slide 5: The proposal
DARLING PRES - WEB SITE VERS.DOC The proposal OVERVIEW Summary ownership structure of Darling Park after the proposal ♦ General Property Trust (“GPT”) will effectively acquire a 40% interest in Darling Park via the acquisition of; – a 25% interest in Darling Park by acquiring a 50% interest in 25.0%
Slide 6: The proposal (continued)
DARLING PRES - WEB SITE VERS.DOC The proposal (continued) DPT PROPOSAL ♦ To be implemented by the redemption of existing units in DPT and the issue of new units in each of AOF and GPT to unitholders in DPT ♦ Unitholders in DPT will be entitled to receive: – 0.501 New Units in GPT; and – 1.075 New Un
Slide 7: The proposal (continued)
DARLING PRES - WEB SITE VERS.DOC The proposal (continued) MANAGEMENT FEE REDUCTION AND INCOME SUPPORT PROVIDED ♦ Reduction in management fee: – GPT: 0.60% to 0.55% of gross assets effective 1st July 2000 – AOF: 0.70% to 0.60% of gross assets effective 1st July 2000 ♦ Reduction in management fees is
Slide 8: The proposal - summary of key benefits
DARLING PRES - WEB SITE VERS.DOC The proposal - summary of key benefits GPT highlights AOF highlights FY01 EPU Lease Duration Management Fee Sydney Office Exposure FY Jun-01 EPU Management Fee Sydney Office Exposure +0.08 cpu 0.05% 10.3% 0.09cpu 0.8 years 0.10% 16.0% From: 0.60% From: 42.4% (1) To:
Slide 9: Acquisition fundamentals
Acquisition fundamentals SECTION 2
Slide 10: Darling Park description
DARLING PRES - WEB SITE VERS.DOC Darling Park description ♦ Australia’s largest mixed-use commercial property: Tower 1 Office 51,220 sqm Tower 2 Office 50,958 sqm Tower 1 and 2 Retail 1,523 sqm Cockle Bay Wharf 8,176 sqm TOTAL 111,877 sqm ♦ 99 year leasehold (expiring June 2088) ♦ Valuation by Jones
Slide 11: Darling Park description (continued)
DARLING PRES - WEB SITE VERS.DOC Darling Park description (continued) ♦ Floors 3, 16 and 22 are vacant, representing 5,693sqm or 5.6% of Tower 1 & 2 (by area and excluding retail). The valuation assumes: – level 3 is leased by January 2001 (1,865 sqm) – level 16 is leased January 2001 (1,885 sqm) –
Slide 12: Darling Park valuation
DARLING PRES - WEB SITE VERS.DOC Darling Park valuation ♦ Darling Park has been revalued by Jones Lang LaSalle at $877m (excluding $10.4m in income support and based on 100% equivalent ownership) as at 1 April 2000 Key valuation details Tower 1 Tower 2 Cockle Bay Total Value ($m) $404m $428m $45m $8
Slide 13: Purchase price
DARLING PRES - WEB SITE VERS.DOC Purchase price ♦ Transactional evidence was used by the valuer to support the price being paid by GPT and AOF Sales evidence Property Price $m Initial Yield % Value $/sqm IRR % Date (1) Darling Park valuation $877.0 5.8 7,839 10.0% Apr-00 (2) The Exchange Centre – 20
Slide 14: DPT balance sheet
DARLING PRES - WEB SITE VERS.DOC DPT balance sheet Pro forma balance sheets Actual DPT at DPT before the 31 December 1999 Proposal(1)(2)(3) Pro forma balance sheets ($m) ($m) Assets Cash 5.2 0.0 Investment properties 437.5 437.7 Other assets 7.3 0.0 Total assets 450.0 437.7 Liabilities Provisions 2.
Slide 15: Impact analysis for AOF
Impact analysis for AOF SECTION 3
Slide 16: Financial impact for AOF
DARLING PRES - WEB SITE VERS.DOC Financial impact for AOF ♦ Distributions maintained post transaction ie. FY01 growth of 1.2% Jun-00(h) Dec-00(h) Jun-01(h) Jun-01 full year No Deal 4.25¢ 4.30¢ 4.30¢ 8.60¢ Proposal proceeds 4.25¢ 4.30¢ 4.30¢ 8.60¢ Change in DPU 0.0% 0.0% 0.0% 0.0% SOURCE: AMP Asset M
Slide 17: Sources and applications of funds - AOF
DARLING PRES - WEB SITE VERS.DOC Sources and applications of funds - AOF Sources and applications of funds – AOF Units on issue in AOF Source ($m) Application ($m) Units on Issue % of New Units issued to DPT $150.5 (1) Darling Park (25% Interest) $219.2 (m) AOF Units unitholders Existing AOF Unithol
Slide 18: Balance sheet analysis for AOF
DARLING PRES - WEB SITE VERS.DOC Balance sheet analysis for AOF ♦ NTA maintained at $1.16 ♦ Gearing increases slightly from 25.4% to 26.7% ♦ Gross assets to increase from $803.1m to $969.1m Balance sheet Pro Forma Balance Sheets December 1999 AOF before the proposal(1) AOF after the proposal As at 3
Slide 19: Key benefits for AOF (continued)
DARLING PRES - WEB SITE VERS.DOC Key benefits for AOF (continued) PORTFOLIO BENEFITS ♦ Increased average lease duration from 4.9 years to 5.7 years indicates a secure income profile for AOF ♦ Over-renting at 16.6%, with the Jessie Centre, Philips House and NRMA Centre offering good upside through ma
Slide 20: Key benefits for AOF (continued)
DARLING PRES - WEB SITE VERS.DOC Key benefits for AOF (continued) OTHER BENEFITS ♦ Management fee reduced from 0.7% to 0.6%, a saving of approximately $1.0m per annum ♦ Increases index weighting from 1.9% to 2.3% ♦ Ranked third in office sub-sector by market capitalisation, previously sixth ♦ Increa
Slide 21: Portfolio summary – AOF
DARLING PRES - WEB SITE VERS.DOC Portfolio summary – AOF ♦ Increased weighting towards ♦ Well balanced rent review profile ♦ Average lease duration improved from 4.9 years to 5.7 Sydney CBD office market years (weighted by net rental income as at Dec 1999) Geographic weighting - pre Lease rent revie
Slide 22: Timetable
Timetable SECTION 4 ABN-AMRO
Slide 23: Timetable
DARLING PRES - WEB SITE VERS.DOC Timetable Announcement date 27 March 2000 Information Memorandum May 2000 Unitholders meeting June 2000 Implementation date Mid June 2000 ♦ The timetable is indicative and may change Section 4: Timetable 20
Slide 24: Investment case for AOF
Investment case for AOF APPENDIX A
Slide 25: Peer group comparison – AOF
DARLING PRES - WEB SITE VERS.DOC Peer group comparison – AOF 2001 yield (%) Premium/discount to NTA (%) 7.7% 8% 4% 7.6% 0% 7.5% (4%) (8%) 7.4% (12%) BTO AOF Post AOF Pre CITCA CITCA Office AOF Post AOF Pre BTO Gearing profile (%) Market cap vs yield (%) 30% 10.0% 9.5% 9.0% 8.5% 25% 8.0% 7.5% 7.0% AO
Slide 26: Peer group comparison – AOF (continued)
DARLING PRES - WEB SITE VERS.DOC Peer group comparison – AOF (continued) Weighted average cap rate (%) 7.6% 7.4% 7.2% 7.0% 6.8% Office AOF Pre BTO CITCA AOF Post Average lease term to expiry (yrs) Over/under-renting (%) 6.0 20% 15% 5.5 10% 5.0 5% 4.5 0% 4.0 (5%) Office AOF Post AOF Pre BTO CITCA AOF
Slide 27: Investment case for AOF
DARLING PRES - WEB SITE VERS.DOC Investment case for AOF ♦ Attractive pricing: – investors can gain entry into a prime quality office portfolio with exposure across the key office markets at asset backing with no allowance being reflected for management or liquidity; and – the 2001 prospective yield
AMP Office Trust — Merger or Acquisition (March 2000) on 6ix