Colonial pays $57.7m for Kiwi Prop management company

By Chris Hutching

Friday 5th April 2002

Sydney-based funds manager Colonial First State Property Ltd paid $57.7 million for Kiwi Property Management Ltd, the management company for listed Kiwi Income Property Trust.

The management company has rights to management fees and also rights to control voting and appointment of directors to Kiwi Income Property Ltd.

The Stock Exchange-listed Colonial First State Property Trust, whose management is also ultimately controlled from Sydney, is unaffected by the move.

Colonial First State, through its control of Kiwi Income and Colonial Property Trust now controls 38.75% of the NZSE property index.

One of the reasons for selling Kiwi Property Management appears to have been to facilitate capital-raising for Kiwi Income Property Trust's proposed redevelopment of Sylvia Park in Auckland, estimated to require about $400 million. Investment money for the Sylvia Park development in Auckland may come from Australia.

There is also speculation that Colonial might merge Colonial First State Property Trust and listed Newmarket Property Trust (managed by the Colonial group) but shareholders of both trusts would have to agree.

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