The deal formed a US$450 million joint venture which initially acquired three flagship shopping centres in Bengaluru, Surat and Chennai for its seed portfolio.
The deal included the formation of a US$450 million (about $586.13 million) joint venture company and concurrent acquisition of an initial seed portfolio of three shopping malls in India comprising approximately 3.5 million square feet across three flagship centres in Bengaluru, Surat and Chennai. APG has provided 77% of the equity for a majority shareholding in the joint venture with Xander investing the balance of 23%.
The joint venture represents the largest single deal in the retail real estate sector in India, pursuant to which the Netherlands largest manager of pension capital, APG, and Virtuous Retail, sponsored by leading emerging markets investment firm The Xander Group Inc., have concurrently acquired an initial seed portfolio of three retail assets from a Xander sponsored fund in a transaction valued at approximately INR 2,000 crores (US$300 million).
The transaction gives APG immediate scale and access to a portfolio of dominant shopping centres and management capability at a time that coincides with the arrival and expansion of major global and domestic brands in India, coupled with the severe shortage of high quality malls.
Dean Moroz, the lead counsel on the transaction says: “We are delighted to have supported APG on their joint venture arrangements with Xander and Virtuous Retail and concurrent acquisition of seed assets from a Xander-managed fund, on a timetable that was exceedingly tight and highly demanding. This investment by APG is particularly unique, as it is structured as the formation of a self-managed operating company of which APG are the majority shareholder, and gives APG immediate exposure to the retail sector in India at a time when organized retail is in early stages of taking flight in the country.”
“The investment underscores APG's continued innovation and market leadership managing pension capital with a view to generating returns for the benefit of a large segment of hard-working citizens of the Netherlands. It is both humbling and gratifying for Ashurst to be involved,” he adds.
The Ashurst team was led by Dean Moroz (Hong Kong) as to the establishment of the joint venture platform and Ed Bennett (Singapore) in relation to the concurrent acquisition of seed assets by the platform, assisted by senior associates Derek Leung (Hong Kong) and Jonathan Scott (Sydney), associate Ray Aye (Singapore) and paralegal Shue Sing Churk (Hong Kong), Andrew Valerio (Singapore) on employment law matters, Liam Nankervis (Melbourne) who handled the IP/licensing aspects of the transaction, and partner James Comber (Hong Kong) and associate Emily Austin (Hong Kong) who assisted with the dispute resolution provisions across documents and related advice.
Shook Lin & Bok acted as special Singapore counsel and JSA acted as APG's lead counsel on matters of Indian law. Xander were represented by Shearman & Sterling (Singapore), A&G (Singapore) and AZB (India). PwC advised on the tax aspects.
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