Australian-headquartered AMP has agreed to extend the date for satisfaction or waiver of conditions precedent to 28 February 2023 over the sale of Collimate Capital to Dexus Funds Management.
The sale of its domestic real estate and infrastructure equity business was agreed in April 2022.
But AMP said in a update on 9 January 2023 there remains an outstanding condition precedent for the completion of the sale to Dexus under the current sale agreement.
This relates to receiving approval from the applicable regulator in China for the transfer of AMP’s interest in China Life AMP Asset Management (CLAMP) out of the sale perimeter.
The terms of the sale agreement with Dexus provide each party with the right to terminate the agreement from 27 January 2023 if all conditions precedent have not been satisfied or waived by that date. While AMP continues to work towards achieving regulatory approval, there is uncertainty around achieving this date.
AMP and Dexus have agreed to extend the date for satisfaction or waiver of conditions precedent to 28 February 2023.
However, if the conditions “precedent are not satisfied or waived by 26 January 2023, the base purchase price will be reduced by A$25m to A$225m, and the remaining potential funds under management (FuM) based earnout (currently A$26m) will be forfeited.
Potential revised transaction structure
Also, AMP and Dexus have entered into a non-binding term sheet which considers a revised transaction structure with a two-stage completion process.
If binding agreements are entered into, the revised transaction structure would allow for most legal entities (holding the majority of the Collimate Capital domestic assets and management rights) as well as employees, to transfer to Dexus at first completion, prior to the satisfaction of the remaining condition precedent and by March 2023.
The transfer of one remaining entity (which currently holds the interest in CLAMP) would occur at final completion following receipt of the necessary regulatory approval.
“This alternative transaction approach would be pursued alongside the existing initial transaction structure for maximum flexibility”, the Aussie group said.
AMP added it “will provide further details on the revised transaction structure if binding documentation is entered into and will keep the market informed of any material updates to the transaction”.
DigitalBridge completion update
The outstanding regulatory approval for the sale of the Collimate Capital international infrastructure equity business to global investment firm DigitalBridge Investment Holdco, a subsidiary of DigitalBridge Group, is in the final stages of the formal approval process.
Subject to finalisation of that process, completion is expected to occur by February 2023.
