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Patrizia turns Euro heavyweight with purchase of Rockspring

Patrizia’s supersonic year of growth finishes with the €7.8bn capture of the London-based pan-Europe-focused private equity real estate firm.

Patrizia Immobilien will finish 2017 among Europe’s biggest real assets managers after making its third major corporate acquisition of this year, supercharging its assets under management and headcount in the process.

The Augsburg-based real estate investment manager has purchased London-based private equity real estate firm Rockspring Property Investment Managers in a deal which sees it inherit €7.8 billion of assets under management and 114 staff across 12 offices in Europe.

The acquisition, due to conclude next quarter, brings Patrizia’s AUM to €40 billion – more than twice the assets under management it started the year with and its headcount close to 1,000 staff.

It follows purchases of Triuva, a subsidiary of fellow German firm IVG, which brought with it €9.8 billion of assets, and Sparinvest, a Danish fund of funds operation active in European and Asian markets with assets of around €1 billion, in the last couple of months.

While the purchase of Triuva boosted its already sizeable exposure to German institutional investors and Sparinvest to Scandinavian investors, the capture of Rockspring is arguably the most significant as it brings with it a roster of institutional relationships from around the world, achieving an aim of the firm to better internationally diversify its capital base.

When Real Estate Capital‘s sister publication PERE interviewed Patrizia’s founder Wolfgang Egger in May, more than 90 percent of the firm’s investors were from Germany. Rockspring’s coverage, meanwhile, is more spread out: 31 percent are from the UK; 27 percent from Asia; 5 percent from North America and 37 percent from continental Europe.

Rockspring’s investors include Korea’s National Pension Service, Dutch pension manager PGGM and Swiss investment bank UBS’ corporate clients.

“This acquisition represents an important milestone for Patrizia in achieving our vision to become a global provider of European real estate assets for our clients,” Egger said in a statement.

“The clients of Patrizia and Rockspring will benefit from access to a stronger independent platform which will offer broader access to markets and products while Patrizia will strengthen its market position significantly in its core European markets. Moreover, the global client base is complementary and will allow both sides to profit from long-lasting trusted relationships which have been built on long-term performance. Patrizia has been preparing for the acquisitions of Rockspring, Triuva and SPI in a careful and strategic way for several months now and I’m delighted that we have been able to finalise each of them this year. It represents a unique strategic opportunity to be able to bring the three businesses into Patrizia in one comprehensive integration process.”

That integration is understood to start once the Rockspring transaction concludes next quarter, after which senior roles are expected to have been determined and the conjoined organisation’s branding will be decided.

Terms of the transaction were not disclosed in the announcement but should be communicated when Patrizia produces its full year results next quarter. PERE understands, however, that the acquisition will be part-purchased with the use of its treasury stock. It currently has about 3 percent of its share base in treasury.

The German stock exchange firm said the acquisition should be accretive to earnings and the news sent its shares up by 2.36 percent in early trading.

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