Lendlease sells Capella financing unit for $235m
Shareholder activist target Lendlease has sold its Capella Capital infrastructure financing business to Japanese trading company Sojitz Corporation for $235 million, advancing its strategy to radically downsize the business with $2.2 billion worth of deals.
Earlier this month, Lendlease offloaded its UK construction arm. The developer, which last year embarked on a restructure after sustained pressure from institutional shareholders, also said it had completed the $516 million ($US320 million) sale of its US Military Housing business – a deal it initially expected to settle by the end of December 2024.
Lendlease’s sale of its stake in asset originator, manager and equity investor Capella, which it established as a joint venture with senior Capella management in 2009, would boost its operating profit after tax by $70 million this financial year, the company said.
Capella employs 80 people. Lendlease and Capella will continue to work together on projects where Lendlease has suitable capabilities such as construction or development services, Lendlease said.
“The sale of Capella Capital accelerates the release of capital while also reducing the group’s future funding commitments, allowing Lendlease to focus on its core Australian operations and international Investments platform,” Lendlease chief executive Tony Lombardo said.
Lendlease kept its earnings guidance unchanged from its last update earlier this month, with group earnings per security of 54¢ to 62¢.
The company’s shares were up 10.5¢, or 1.7 per cent, at $6.48. They have lost 12.6 per cent over the past 12 months.
For Tokyo-listed Sojitz, the Capella deal closely follows the acquisition of 70 per cent of Sydney-based airconditioning and building-services company Climatech Group, sealing its position – in the form of heating, ventilation and airconditioning business, Ellis Air – as one of the country’s biggest HVAC contractors.
The moves by Sojitz into real estate businesses come after Sumitomo Corporation in December entered into a joint venture housing development with Mirvac in north-western Sydney’s Highforest.
That deal marked the start of a likely wave of investment in Australian real estate by Japan’s large general trading companies, following earlier moves by property, transport and utility companies, Ian Williams, the author of Herbert Smith Freehill’s annual report on Japanese investment in Australia, told The Australian Financial Review.
