In a statement to the ASX, Cromwell said it had entered into a conditional share purchase agreement to acquire Valad Europe from Blackstone Real Estate Partners VI and Valad Europe senior management.
Cromwell pointed out the acquisition will be funded by an underwritten €150 million ($216 million) convertible bond issue.
“The convertible bonds will be issued by Cromwell SPV Finance (issuer) and will pay a fixed coupon rate of no more than 2.375 per cent per annum (underwritten maximum) for a term of five years,” the statement from Cromwell said.
“[They] will rank as unsubordinated, unconditional, and unsecured obligations of the issuer, guaranteed by Cromwell, and are intended to be listed on the Singapore Exchange Securities Trading Limited.”
“Prior to maturity, the convertible bonds are convertible into Cromwell stapled securities at a price of at least $1.12 per stapled security (underwritten minimum) (subject to certain adjustments), which reflects a premium of five per cent to the Cromwell stapled security closing price on 23 January 2015,” the statement said.
Cromwell chief executive Paul Weightman said the acquisition of Valad Europe presents an opportunity to acquire a successful funds management platform.
“The business is a strong cultural fit with Cromwell, is complementary to our existing funds management operations, and furthers our strategy to increase the earnings contribution from funds management to approximately 20 per cent,” Mr Weightman said.
The acquisition is conditional on Cromwell and Valad Europe receiving regulatory approvals from the UK Financial Conduct Authority and the Guernsey Financial Services Commission.
“These approvals are expected to be received by 9 April 2015, with settlement immediately thereafter,” the statement said.
