The Cromwell Property Group (ASX: CMW) share price is on watch this morning after the Aussie property manager announced the sale of its 50% stake in Northpoint Tower.
What did Cromwell announce?
In its after-market ASX announcement, Cromwell said it had exchanged contracts to sell its 50% interest in Northpoint Tower for $300 million to Early Light International.
Following the sale, Early Light will acquire a full ownership interest in the building.
Early Light is a Hong Kong-based company which is currently the world's largest manufacturer of toys.
Management said that the sale of Cromwell's remaining interest in Northpoint, alongside its recent successful $375 million institutional placement and new 3-year €225 million (A$365 million) syndicated facility will provide certainty of funding for the group.
Cromwell has its eye on $1.0 billion of acquisition opportunities that are either in exclusive due diligence or advanced negotiations as well as over $1.0 billion of value-add development opportunities.
The company's Chief Investment Officer (CIO) said the company is continuing to "identify value-enhancing investment opportunities across both its Indirect and Direct Property Investment segment" that will deliver "medium-term growth in enterprise value" for investors.
Northpoint comprises 44 levels of mixed office and retail tenancies, with Cromwell acquiring its stake in the building for $139.35 million in December 2013.
A $130 million redevelopment commenced in January 2016 and reached practical completion on time and on budget in March 2018 before Cromwell's sale of its stake for a tidy $300 million.
The sale is subject to Foreign Investment Review Board (FIRB) approval and is expected to settle in mid-September 2018.
What's been happening to the Cromwell share price?
The Cromwell share price is up 20% so far this year to $1.18 per share and is approaching its 52-week high of $1.27 which it achieved just last week.
Cromwell's share price dropped sharply last Tuesday as the company completed its $375 million institutional placement at $1.15 per new security, which investors saw as a sign that its then-$1.27 was a little bit on the pricey side.
The company appears to be in good financial shape and will be releasing its full-year results in August 2019.
