Analysis & Comment

Sweden's EQT to buy real estate investment firm Exeter for $1.87 billion

STOCKHOLM (Reuters) – Sweden’s EQT said on Tuesday it had signed a deal to buy global real estate investment manager Exeter Property Group for $1.87 billion as the buyout group reported an almost doubling in net profit for 2020.

FILE PHOTO: Swedish private equity group EQT CEO Christian Sinding poses for a picture at the company’s headquarters in Stockholm, Sweden June 24, 2019. REUTERS/Esha Vaish

EQT said the acquisition fitted well with its plan to expand its real estate operations, particularly in North America where the firm aims to strengthen its position.

Exeter, majority-owned by Ward Fitzgerald and other members of Exeter’s management team, has more than $10 billion of assets under management, EQT said in a statement.

“We’ve found a perfect match in that they are similar to us in terms of growth, financial profile and underlying culture,” EQT Chief Executive Christian Sinding said on a conference call with analysts.

“Real estate is a market we see as quite attractive, growth has been strong and we expect that to continue,” he added.

EQT shares were up just over 10% at 0840 GMT.

Pennsylvania-based Exeter is focused on acquiring, developing and managing commercial and residential properties mainly across the United States and Europe.

The consideration for the acquisition consists of $800 million in new EQT shares and $1.07 billion in cash.

Exeter is expected to generate around $135 million in revenues for 2020, EQT said.

“The transaction supports EQT’s diversification across asset classes as well as provides a stronger footprint in the U.S.,” Citi analysts said in a note.

EQT also reported an annual net profit of 283 million euros ($343.17 million) compared to 149 million a year ago, beating a mean forecast of 230 million euros in a Refinitiv poll of analysts.

It proposed a dividend of 2.40 Swedish crowns per share paid in two equal instalments in June and December.

Assets under management grew by 46% to 52.5 billion euros, a record year for the firm in terms of fund raising.

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