Challenger plays-down property sale claims

By Craig Phillips

ChallengerFinancial Services Group has scotched rumours it has entered exclusive talks to sell its British property assets to entrepreneur Vincent Tchenguiz, brother of property tycoon Robert Tchenguiz.

The move follows reports in the UK the group was about to sell its UK assets in what would be one of the largest commercial property deals in Britain this year.

However, Challenger, which stated back in May it was looking to sell its more than $1 billion in international property assets in the UK and the US, says it is yet to enter into a contract of sale with any parties.

“[Challenger] only intends to complete a sale of our foreign properties at a premium to book value as at December 31, 2003,” the group says.

At the end of May this book value was $685 million.

The UK properties to be offloaded include London situated Minster Court, Senator House, Hayes Park and 3 World Business Centre.

In June, as part of its sale of non-core assets, Challenger chose superannuation back-office firm Australian Administration Services (AAS) as the preferred bidder for its flagged sale of corporate super administration business, Challenger Superannuation Services (CSS).

The sale to the now Telstra-aligned Kaz Group’s AAS followed Challenger opting to sell after no longer deeming corporate super admin as having a strategic fit with its business.

In March of this year Challenger also sold 11 of its Australian property interests, which included five cinemas, four commercial property/industrial properties, and an office building and call centre to Cromwell Corporation for $152 million.

In the same month, Challenger, which listed on the Australian Stock Exchange late last year, also finalised a deal with Great Southern Plantations that saw the latter acquire its 84,000 hectares of forestry assets for $71 million — a $17 million premium on Challenger’s acquisition price.