ING fund undergoes review of capital management facilities
The ING Industrial Fund (IIF) has undertaken a review of its capital management initiatives to reduce its gearing level due to the weak Australian dollar, declining asset values, and the volatile foreign exchange rate.
The IIF is negotiating with its lending group to amend the terms of its facilities, which are due for maturity in 2010 and 2011. It is also increasing the maximum total leverage ratio by 5 per cent to 60 per cent until December 2009 to allow greater flexibility.
The IIF will transfer a portion of its Canadian and Euro denominated borrowings into Australian dollar borrowings to reduce the impact of shifting currency exchange rates on its gearing levels.
It is also contracted to sell more than $20 million of Australian assets prior to the end of the year. The IIF will also divest its property portfolio in Europe in the next 12 months and sell its non-core industrial assets in Canada.
It will also amend its distribution policy to pay a distribution equivalent to 10 per cent of the average trading price of the IIF’s units each quarter.
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