Macquarie Underwriting Seeks Investment for AAPC Tourism Trust

Strategic Insights -

Macquarie Underwriting, along with Prudential Bache and Potter Warburg, is courting top institutions to invest in the newly formed hotel property group AAPC Tourism Trust. The trust, capitalized at approximately $200 million, will hold the property assets of the AAPC Group, a $500 million company that owns and manages over 20 hotels in Australia. The underwriters are targeting professional investors and hope to list the trust on the sharemarket by early next year. The trust's asset management company will be formed by AAPC, Macquarie Bank, and Peregrine Capital, with Accor's international reservations system linking all the hotels.

Key Takeaways:

  • The AAPC Tourism Trust is valued at approximately $200 million and will hold the property assets of the $500 million AAPC Group.
  • The trust will target professional investors and aims to list on the sharemarket by early next year.
  • The asset management company will be formed by AAPC, Macquarie Bank, and Peregrine Capital, with Accor's international reservations system linking all the hotels.
  • The hotels within the AAPC Tourism Trust include the Ibis in Melbourne, Tradewinds in Cairns, Quality River Plaza in Brisbane, and The Heritage in Bowral.
  • AAPC, which will hold 28% of the new trust, operates the Asia-Pacific franchise for Accor SA brands including Novotel, Ibis, and Mercure.
  • Peregrine Capital, based in Hong Kong, is entering the Australian market through this trust.
  • The management company's board includes Mr. Ian Ferrier, a senior partner in Ferrier Hodgson, as chairman, and Mr. George Bennett, a former executive chairman of KPMG Peak Marwick, as an independent director.

Statistics:

  • The AAPC Tourism Trust is capitalized at approximately $200 million.
  • The AAPC Group is a $500 million company that owns and manages over 20 hotels in Australia.
  • The trust is expected to list on the sharemarket by early next year.
  • 7% annual compound growth in international visitors to Australia was a factor in the underwriters' decision to raise capital.
  • AAPC will hold 28% of the new trust, while Macquarie Bank will hold 40% and Peregrine Capital will hold 20%.

Sources:

AAPC Tourism Trust press release, January, no date specified

AAPC Group brochure, 1999, no publication date specified