Keppel Corporation Limited has entered into an agreement with Aermont Capital Group SCSp to acquire an initial 50% stake in European real estate manager Aermont Capital.
Subject to regulatory and other approvals, Keppel will acquire a 50 per cent stake in Aermont in H1 2024, creating a 50 / 50 joint-venture.
Acquisition of the remaining 50 per cent stake in Aermont by Keppel is envisaged to close in H1 2028. The consideration for each stake is expected to be funded through a combination of cash and shares in Keppel.
”The consideration of up to S$517 million for the initial 50% stake in Aermont, which can be funded through a combination of cash and treasury shares acquired through Keppel’s earlier share buyback programme, implies an attractive valuation of c.13x EV/EBITDA,” said Keppel in a press release.
Established in 2007, Aermont is an independent asset management business focused on real estate and real estate-related investment activities in Europe.
As at 30 June 2023, Aermont had a total FUM of S$24 billion across four active funds and a single asset vehicle, of which approximately S$10 billion in equity commitments were raised in 2022, reflecting the strong support from Aermont’s LPs.
Aermont’s investments have included assets and businesses in the office, student accommodation, workforce housing, luxury hospitality and production studio infrastructure sectors, among others. Through its funds, Aermont has generated an average realised 25% gross internal rate of return and 2.8x gross multiple on invested capital to date.
Loh Chin Hua, CEO of Keppel Corporation, said, “Aermont Capital runs an established and highly successful asset management platform in Europe, raising the most capital among European real estate funds in the last five years, despite the COVID-19 pandemic. The acquisition of an initial 50% stake in Aermont, with a pathway to an eventual 100% ownership and full integration, marks a major strategic step forward in Keppel’s ambition to be a global asset manager and operator, availing us of a highly attractive European platform with strong recurring fees and a premium network of global LPs.
“We are very pleased to welcome Aermont Capital and its experienced team, helmed by its Chairman, Mr Léon Bressler and Managing Partner, Mr Paul Golding, who together with their partners, have built a top performing and impressive franchise in Aermont that has attracted some of the world’s most prominent LPs. Aermont’s operating culture is very similar to Keppel’s, with a strong emphasis on value adding and active management, while their opportunistic strategy is a good complement to our core and value add investment approach. Keppel looks forward to the partnership and is committed to support and build on the culture that has made Aermont successful, as we add value to each other by harnessing our collective expertise for growth.”
Léon Bressler, Chairman of Aermont Capital, said, “We are looking forward to building a close partnership between Keppel and Aermont. Keppel offers something specific and compelling to our franchise; its technical and operating expertise are well-aligned to key megatrends such as the energy transition, digital transformation and urbanisation. For Aermont, access to that expertise will help us better capitalise on a number of technology-driven opportunities. It will also open the door to new fund strategies, enabling us to eventually offer more to our LPs and to broaden the professional opportunity to our team. Moreover, we will continue building on Aermont’s unique culture rooted in operational expertise, deep value creation and an LP-first approach, all of which Keppel shares. Teaming up with Keppel today therefore makes us stronger, more capable and better positioned, which will be to the benefit all Aermont stakeholders.”
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