MA Financial launches $1b real estate fund, shares rise
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The news: Asset manager and investment bank MA Financial will launch a $1 billion real estate credit vehicle for institutional investors with US private equity firm Warburg Pincus.
The numbers: MA Financial said it will manage the vehicle and co-invest via equity and notes in the vehicle in an amount representative of 2% of total capital, up to $20 million. The company said institutional investors will be offered to participate in the vehicle via a note issuance, first anticipated to occur by 31 December, with an initial target for fire close of at least $700 million in commitments.
MA Financial also announced a $1 billion strategic financing partnership with Flexicommercial, part of ASX-listed fintech Humm Group.
Meanwhile, MA Financial reported inflows of $1.1 billion for the six months to 30 June, up 16% compared to the prior corresponding period. Assets under management climbed 13% year on year to $9.7 billion while net profit after tax fell 27% to $17.8 million.
However, underlying EBITDA reduced 16% to $38.3 million as underlying revenue grew 5% to $124.5 million.
The company declared an interim dividend of 6 cents per share, in line with a year ago.
MA Financial shares gained 7% to $4.72 by 10:35am AEST.
The context: The Melbourne-based asset manager said its earnings slide reflected the impact of investment in future growth, including scaling its MA Money platform, expanding its private credit business in the US, and investing in the growth of the MA brand.
The company expects improved earnings into the second half, as MA Money reaches profitability following loan book growth and steady net interest margin improvement.
What they said: "We are very pleased to announce two major initiatives today including the launch of a new institutional real estate credit vehicle with Warburg Pincus and the establishment of a strategic partnership with Humm Group," said MA Financial's joint CEOs Julian Biggins and Chris Wyke.
"These relationships are expected to significantly broaden the reach of MA Financial and continue to build on the strong foundations that our teams have built over the past 15 years," they said.
The sources: ASX announcement, ASX announcement
