UPDATE 1-Australia's Dexus to merge fund with AMP Capital property fund

(Adds details, AMP Capital statement)

March 16 (Reuters) - Australian real estate developer Dexus said on Tuesday it had struck a deal to merge an unlisted property fund with a diversified real estate investment fund run by AMP Capital.

The company said unitholders of its A$10.1 billion ($7.82 billion) Dexus Wholesale Property Fund (DWPF) and the A$5 billion AMP Capital Diversified Property Fund (ADPF) were expected to vote on the merger in late April.

“ADPF is a strategic fit with DWPF’s existing portfolio providing additional exposure to premium assets,” said Michael Sheffield, a fund manager at DWPF.

ADPF invests in the office, retail and industrial sectors, and its portfolio includes investments in Sydney’s Quay Quarter Tower and Westfield Warringah Mall.

In a separate statement, AMP Capital acknowledged ADPF's decision to recommend the DWPF merger, but said it had put forward an alternate proposal which would deliver value to unitholders. (

While AMP Capital did not disclose details of its proposal, it said it had the backing of its parent company AMP Ltd which had also informed U.S.-based Ares Management.

Ares last month announced plans to buy 60% of the private markets business of AMP Capital for A$1.35 billion. ($1 = 1.2900 Australian dollars) (Reporting by Shashwat Awasthi in Bengaluru; Editing by Leslie Adler and Kim Coghill)