- The Agency Group (AU1) is forming a strategic partnership with private company Managex Funds Management
- Managex has agreed to purchase The Agency’s West Coast rent roll business for roughly $3.6 million
- The Agency Group believes the sale will strengthen its balance sheet without increasing debt or diluting shareholders
- As part of the deal, both companies will enter a referral agreement whereby all sales leads that Managex generates will be referred to The Agency
- Similarly, all property management leads from The Agency will be referred to Managex
- The transaction is expected to be completed before the end of this month
- Company shares closed 2.50 per cent in the red to trade for 3.9 cents
The Agency Group (AU1) is forming a strategic partnership with private company Managex Funds Management.
Under the terms of a binding sales agreement, Managex has agreed to purchase The Agency’s West Coast rent roll business for roughly $3.6 million. However, the sales agreement doesn’t include the company’s East Coast property management business which comprises 3665 properties as of June 30 2020.
Managex secured debt funding for the acquisition from Judo Bank.
The Agency Group considers the sale of the West Coast rent roll business to be a strategic move in strengthening its balance sheet and providing the platform for growth without increasing debt or diluting shareholders.
“The sale of our WA rental roll business is a positive for us, improving our balance sheet and facilitating greater alignment to our core business,” The Agency Group Managing Director Paul Niardone said.
“Managex aims to acquire, aggregate and manage Australian residential rent rolls. This partnership with The Agency is the first in a pipeline of acquisitions for Managex,” Managing Director Kim Slatyer said.
Under a licence agreement, Managex will use The Agency Group brand to retain property management staff, while The Agency has agreed to house Managex at its Perth office.
As part of the deal, both companies will enter a referral agreement whereby all sales leads that Managex generates will be referred to The Agency. All property management leads from The Agency will also be referred to Managex.
The transaction is expected to be completed before the end of this month.
Company shares closed 2.50 per cent in the red to trade for 3.9 cents.