Latest: Ripplewood takes Seagaia, Law Lords find minister’s dual powers don’t infringe developers’ rights, Babcock & Brown bids for MTM Entertainment Trust, AMP Diversified raises profit 2.4%, Henderson Land restructure, bid to sell half-finished Chinese projects, ING reshuffle.
13 May 2001
Private New York equity fund Ripplewood Holdings LLC, which took over Japan’s Long Term Credit Bank and turned it into Shinsei Bank, has taken control of the Seagaia Resort, which ran up Â¥122 billion ($NZ2.36 billion) of losses in seven years. Seagaia, in the south of Japan, has hotels, golf courses, and a wavemaking machine at a huge artificial beach. Ripplewood will pay $US229 million to buy Seagaia, $US147 million to pay off debt, and $US81.5 million over four years to get it performing (not quite $NZ1.1 billion).
The Law Lords have found developers’ rights are not infringed by the dual powers of Britain’s Secretary of State for the Environment, on one hand being responsible for planning policy and on the other having a quasi-judicial role in planning appeals. The English Appeal Court had found the minister’s dual capacity breached article 6(1) of the European Convention on Human Rights, guaranteeing citizens the right to a fair trial by an independent tribunal, which came into effect in England and Wales this year. While it was suggested to me that finding the system breached human rights would have paralysed the planning system, we have the same conflict here at council level, where councillors daily find they are setting policy and judging on planning issues. That conflict is the cause of many appeals to the Environment Court.
10 May 2001
The second party to the Force Entertainment Centre ownership dispute is being bought out. The developer, Force Corp, has been taken over by Sky City NZ Ltd, which saw synergies for its business in retaining the Queen St entertainment centre. MTM Entertainment Trust of Sydney, which was determined not to proceed with the centre acquisition, is now subject to takeover by investment banker Babcock & Brown Pty Ltd, part of a group formed in the US in 1977, now owned 20% by Germany’s second largest bank, HypoVereinsbank, and the rest by staff. Sunderton, a Babcock & Brown company, has offered A34.5c/unit for the MTM trust and has options to buy Multiplex Constructions Pty Ltd and Inanda Associates Pty Ltd out of the management company, which has already lost management of MTM’s industrial trust to James Fielding Investments. Sunderton’s deal also includes buying the $A9.2 million Perth Imax from Multiplex.
The Australian AMP Diversified Property Trust, managed by AMP Henderson Global Investors Ltd, raised operating profit 2.4% in the March year (there was no tax) to $A83.24 million on revenue up 6.6% to $A107.2 million and its share of associates’ net earnings, up 9.3% to $AAA35.6 million. Earnings/unit were A19.03c (A19.13c), final dividend A9.95c/unit, year’s dividends A19.1c/unit (A18.6c/unit), net asset backing $A2.35 ($A2.31). Consolidated operating profit before abnormals and tax represented 77.66% (80.78%) of sales revenue, and consolidated operating profit after tax 7.93% (8.29%) of equity at the end of the period. Gross assets were $A1.47 billion.
8 May 2001
Lee Shau-kee, chairman of Henderson Land Development Ltd, has fuelled speculation about a group restructuring after pushing Henderson Land’s share of Henderson Investment Ltd to 74.77% with $HK422 million of buying this year. Henderson Investment increased its stake in Miramar Hotel by 5% to 39.5% last year.
A Chinese Construction Ministry subsidiary, Pan-China Engineering, is to set up a Hong Kong company to help China’s four state asset-management companies dispose of half-finished property projectsand bare development sites untouched since Beijing moved in 1998 to cool the overheated property development market. The asset management companies have custody, but no money to run the projects.
ING Industrial Fund has contracted to sell three Victorian properties for $A12.77 million, fractionally above book value. The fund will use the money on developments in the Parkwest industrial estate in Victoria and at Longlea, Queensland, where the average initial yield is 10%, compared to 8.82% on the properties being sold.