Auctus has signed binding agreements to make an initial investment of US$500,000 in Odyssey Group, in exchange for a 9.9 per cent stake in the Asian group.
The initial investments funds will be used as working capital by Odyssey, powering its growth into Asia.
Auctus reported the investment will also expand its distribution capacity to Asia, with the firm’s managing director Campbell McComb to be appointed to the Odyssey board.
Auctus’ first step into the Asian market will take place via a joint launch of the US Student Housing Fund with Odyssey, which will offer the same investment profile currently available through Auctus’ Australian Unit Trust – The SQ Property Opportunities Fund.
But subject to regulatory approval from the Monetary Authority of Singapore (MAS) and the Securities and Futures Commission in Hong Kong, the group will further increase its holding in Odyssey to 20 per cent.
Auctus will gain the second piece with a further $500,000 cash payment to acquire shares, as well as enacting a share swap with Odyssey founders Alex Walker and Daniel Vovil, which will see the Australian group issue 560,000 shares.
The founders also have an ability to sell down further shares in Odyssey, which could see Auctus’ holding in the group increase to 33 per cent, depending on whether or not the triggers for a third and forth tranche are hit.
If Odyssey is able to raise US$12.5 million, it could trigger Auctus raising its stake to 26.5 per cent. If Odyssey hits US$25 million, Auctus may reach 33 per cent holding.
Auctus has also indicated that it will have the option to take its ownership to 51 per cent and then to 100 per cent via the acquisition from the founders’ shares in Odyssey over the next two years.
“We have high conviction in the outlook for Asian investors’ appetite for private market investments,” Mr McComb said.
“Equally, we are excited to be working with Alex, Dan and the Odyssey team to assist them in the continued growth of their business.”
Odyssey co-founder and chief executive Mr Walker commented the two firms share a focus on the private market space.
“Odyssey has been seeking the right strategic investor for the past 12 months and believes we have found this in Auctus,” he said.
Odyssey looks over total assets under management and advice of US$180 million, with licensed operations in both Singapore and Hong Kong. Meanwhile Auctus manages $320 million in assets, with a focus on private equity, infrastructure and private real estate.
Sarah Simpkins
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
