Merrill Lynch and British Airways invest £55m in cash and property
Ashtenne said it could increase its industrial fund to £580m after the injection of £55m of new equity this week.
Merrill Lynch Investment Managers invested £19.4m of property, in exchange for equity, and £15.6m in cash in the Ashtenne Industrial Fund, while British Airways Pension Fund invested £20m in cash.
Ashtenne is expected to inject the industrial section of the portfolio it is close to buying from Mentmore into the fund.
The quoted firm has offered £177.8m in cash for Mentmore’s serviced shops, offices and industrial business. The 147 industrial sites could amount to up to £70m.
Joint chief executive Ian Watson would not comment on the Mentmore deal, but said of the equity boost:”This is a big vote of confidence for the fund and will give us a lot of firepower.”
The industrial fund was set up in June 2001 as a limited partnership between Ashtenne and Morley.
Ashtenne said the new equity would enable it to grow to around £580m with its target of 50% gearing, but it could gear up to 60%.
Hermes and Foreign & Colonial have also invested in the fund. Ashtenne’s stake is now around 24%.
At 31 December the fund had property assets of £386m.
The properties Merrill transferred into the fund were those held in the Merrill Lynch Ashtenne Limited Partnership, which has now closed.
