12th Feb 2024 08:23
(Alliance News) - Tritax Big Box REIT PLC on Monday said UK Commercial Property REIT Ltd has agreed to an all-share takeover offer to create the UK's fourth largest real estate investment trust by market capitalisation, at nearly GBP4 billion.
The announcement by the two FTSE 250 index constituents represents the latest in a series of mergers of London-listed property companies since the year began.
Early last month, LondonMetric Property PLC and LXi REIT PLC also agreed an all-share merger, which at the time they said would make the company the UK's fourth largest REIT, citing GBP4.1 billion in EPRA net tangible assets.
Later in January, Custodian Property Income REIT PLC and abrdn Property Income Trust Ltd agreed an all-share merger to create a REIT with combined assets of GBP1.0 billion.
Tritax Big Box on Monday said it has reached an "agreement on the key terms" of a possible all-share takeover bid for UK Commercial Property.
UKCM investors stand to receive 0.444 of a new Tritax Big Box share for every UKCM share they own.
Based on Tritax Big Box's closing share price on Friday, the deal would value each UKCM share at 71.1 pence and the full company's equity at GBP924 million.
UKCM shares were up 2.6% at 65.88p early Monday in London for a market capitalisation of GBP856.0 million. Tritax Big Box shares were down 0.8% at 159.00p for a market cap of GBP3.03 billion.
UKCM had EPRA net tangible assets of 78.7p per share on December 31, while Tritax Big Box had 177.2p.
UKCM shareholders would own 23% of the enlarged company. A tie-up would "bring together complementary logistics-oriented investment portfolios with a shared focus on resilient and growing income", Tritax Big Box said.
Tritax Big Box said UKCM's board, excluding Chair Peter Pereira Gray, deems the possible offer sweet enough to recommend to shareholders. UKCM shareholders Phoenix Life and Investec Wealth & Investment UK, which own just under 57% of UKCM shares, also would back a bid on these terms.
UKCM had issued a statement dated Friday saying it was reviewing an indicative proposal from Tritax Big Box, which it called "the latest of a series of indicative proposals received from BBOX".
By Tom Waite, Alliance News editor
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