Australian public firm acquires Equitable real estate subsidiary.

Lend Lease Corporation (Australian Stock Exchange: LLC), Australia's largest public property and financial services company with substantial global interests, has reached an agreement with The Equitable Companies Incorporated (NYSE: EQ) to acquire The Equitable's real estate subsidiary, Equitable Real Estate Investment Management (ERE), for $400 million.

The sale is subject to Hart-Scott-Rodino review and certain New York State Insurance Department approvals and other normal and customary conditions.

Land Lease Corporation is a global diversified real estate, construction and financial services company managing $27 .billion in total funds. It has major operations in the U.S., Australia, Asia and Europe. The company's total market capitalization is $4.5 billion.

Lend Lease said it will combine ERE, which manages $25 billion in real estate assets, with its own U.S.-based real estate investment management arm, The Yarmouth Group. The acquisition will make Lend Lease's global real estate investment management business one of the largest in the world, with almost $35 billion in real estate assets under management on five continents.

Lend Lease said it anticipates that the acquisition, which is expected to close before the end of its fiscal year on June 30, 1997, will be immediately accretive to its earnings.

"By creating one of the world's largest, most diversified real estate investment managers, with international advisory, development and management operations, this acquisition will allow us to offer our clients greater depth of advice and service with a range of products," said David Higgins, CEO of Lend Lease. "The integrated company will be broadly skilled and extremely well placed in increasingly sophisticated capital markets to provide institutional investors with the complete spectrum of investment advice, opportunities and implementation services they seek both in the U.S. and internationally. We are prepared as appropriate to put more of our own capital alongside our investors. The market in the future will demand well-capitalized investment managers who work in partnership and co-invest with their clients."

ERE ranks as the largest U.S. manager of tax-exempt real estate assets, serving approximately 300 major U.S. corporations, public and union pension funds and international investors. In addition to the investment management business, the sale included ERE's Compass property management units; its mortgage division; and ERE Rosen, a REIT portfolio management firm. ERE posted strong results in 1996 in terms of portfolio performance, transaction volumes and new business.

Upon completion of the transaction, Lend Lease said it will begin a process of integration that will result in the U.S. operations becoming a single company, to be known initially as ERE/Yarmouth, with five operating units.