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AXA IM bolsters Asia presence with Eureka buy

The real estate subsidiary of French insurance giant AXA has made its most significant foray in the region so far with the acquisition of one of Australia’s biggest private real estate investment managers.

AXA Investment Managers – Real Assets (AXA IM-Real Assets) has significantly bolstered its presence in Asia-Pacific with the purchase of Eureka Funds Management, a Sydney-based independent real estate fund and investment manager.

Prior to the acquisition of Eureka, which has more than A$5 billion ($3.8 billion; €3.4 billion) of assets under management, the €66 billion AXA IM-Real Assets had around €550 million AUM in Asia.

Terms of the deal have not been disclosed and AXA-IM Real Assets declined to comment on the financials. However, Frank Khoo, global head of Asia at AXA IM – Real Assets, said: “Eureka provides us with exposure to one of the two core real estate markets in Asia alongside our Japanese investment center where we have been actively investing for over a decade.”

Khoo joined in 2008 and set a strategy of growing a funds management business, primarily in Japan and Australia. While a platform was established in Japan and funds were raised for that country’s market, until now, establishing a meaningful presence in Australia had proved more challenging. Indeed, AXA previously had just a single holding in Australia which they acquired back in September 2013 with Eureka for A$168 million.

Eureka, founded in 2004 by Bob Kelly, Kumar Kalyanakumar, Quentin Shaw, Niall McCarthy and Rod Cowdroy, focuses predominantly on core assets and has made investments in the office, retail, industrial, hotel and residential sectors.

The real estate subsidiary of French insurance giant AXA will continue to use the Eureka name post acquisition, with Eureka operating as “Eureka -Real Assets”.

“As one of the world’s most liquid and transparent property markets, as well as a significant source of capital, we have long targeted Australia as a key region in AXA IM – Real Assets’ global expansion strategy and the acquisition of Eureka provides us with an immediate and significant footprint in this important region,” commented Pierre Vaquier, chief executive of AXA IM – Real Assets.

“Our main focus is to grow organically, however, we also consider, when appropriate, selective acquisitions, when they either complement our range of capabilities and/or when they give us access to specific countries we do not cover. The fact that we have worked in collaboration with Eureka in 2013 also gave us a lot of confidence that this was the right course of action as we have many common views and strategies.”

AXA Investment Managers – Real Assets’ €66 billion in assets are split €50.4 billion in direct property and infrastructure and €12.6 billion in real asset finance, as of end of June 2016. The firm has around 600 people working in 14 offices across 24 countries.