Nedbank Corporate and Investment Banking (NCIB) has concluded an estimated R1.14-billion loan facility to finance a joint venture (JV) between Durban-based commercial property development company Collins and construction and infrastructure company Aveng.
This came after Collins won a private tender arranged by Aveng, which saw the company dispose of a 70% interest in a portion of their industrial property portfolio in a sale and leaseback transaction to Collins. Aveng will retain a 30% stake in the company formed to house the JV between the parties.
NCIB investment banking managing executive Brad Maxwell says that the deal was made possible by a combination of a partnership-based approach by all the stakeholders and close collaboration between the property finance, corporate finance, client coverage and tax advisory businesses of NCIB.
“The corporate finance at NCIB acted as investment bank and corporate adviser to Aveng, while our property finance division provided senior debt funding of R985-million to the partners for the acquisition of the property portfolio, as well as equity and mezzanine funding, totalling about R164-million, for Collins for their equity participation in the transaction,” he states.
Already, Collins has established a firm standing as a key private property player in the South African market and is one of Nedbank’s major clients in KwaZulu-Natal, with a number of substantial deals concluded in the past three years, in excess of R1-billion.
“This is an exciting transaction for both companies, which presents an opportunity to build on each other’s strengths to become market forces within the African continent,” NCIB property finance managing executive Robin Lockhart-Ross points out.
Collins’ Murray Collins mentions that the company is pleased to have concluded the transaction as it adds significant and valuable stock to the company’s commercial property portfolio.
Maxwell also adds that the willingness of Aveng to involve Nedbank in the transaction right from the tender stage was a significant contributor to the eventual success of the deal.
“The involvement of all our NCIB teams in the sales process, the selection of the most appropriate acquirer, the structuring of the complex finance design and the eventual conclusion of the transaction allowed us to deliver precisely the right deal for both parties,” he concludes.