23rd May 2019 09:34
LONDON (Alliance News) - LondonMetric Property PLC boosted its dividend Thursday after its dsitribution-led strategy delivered annual assets and income growth, whilst it also announced the GBP415 million takeover of London-listed property peer A&J Mucklow PLC.
Over the year ended March, net asset value per share grew 5.9% to 174.9 pence from 165.2p the year prior. This was after net rental income rose 3.5% to GBP93.8 million from GBP90.6 million the year before.
"These results again demonstrate that our pivot into distribution was the right strategy to ensure that we could deliver reliable, repetitive and growing income-led returns that will outperform over the long term," LondonMetric Chief Executive Andrew Jones said.
LondonMetric proposed an 8.2 pence per share full-year dividend, 3.8% higher than the 7.9p paid the year prior.
In a separate announcement, LondonMetric has made a GBP414.7 million cash-and-shares offer for A&J Mucklow.
The deal would see LondonMetric pay 655.20 pence per share through 204.50p in cash and 2.19 new LondonMetric shares for every Mucklow share.
Shares in LondonMetric were 0.4% lower at 205.00p on Thursday, and Mucklow 18% higher at 645.00p.
The board of Mucklow have unanimously recommended investors vote in favour of the acquisition.
"We believe today's announcement of the recommended offer for Mucklow is a natural next step for the company," Jones added.
"With a highly complementary portfolio focused on the outperforming urban logistics sector along with asset management opportunities, which play to LondonMetric's strengths and experience, we believe this transaction creates a compelling combination, which will offer attractive shareholder returns both today and in the years to come."
LondonMetric Chair Patrick Vaughan explained: "The combination of their assets, of which approximately 70% is in distribution and industrial property, is consistent with our strategy of increasing our urban logistics exposure. The combination has compelling strategic and portfolio rationale with strong operational and financial benefits."
After completion, LondonMetric shareholders will own 84% of the combined firm with Mucklow investors holding the remainder.
"I have got to know Andrew and his team well over the last few months and am confident LondonMetric is the right fit for Mucklow," Mucklow Chair Rupert Mucklow said.
"LondonMetric has a complementary portfolio which mirrors Mucklow's focus on high quality income-producing properties and the LondonMetric management team has the necessary expertise to build on the success that Mucklow has achieved over the 57 years it has been a listed company."
"The combination recognises the value of the Mucklow portfolio and resolves the uncertainty around succession planning," Rupert Mucklow added. "I am excited about the future for the combined group as a more resilient and diversified UK-REIT."