Warehouse REIT granted extension for possible takeover deal with Blackstone
Warehouse REIT, the specialist warehouse investor which operates out of Chester, has requested, and been granted, an extension to the offer period for suitor Blackstone to decide whether or not to table a firm bid for the business.
On March 25, Warehouse REIT received a takeover proposal from Blackstone valuing the business at approximately £489m.
Two days later, it said it would recommend the offer to its shareholders, should Blackstone formally submit one.
However, Blackstone wrote to Warehouse REIT on May 7, raising several matters arising from its due diligence, the most significant of which related to contrasting views on the valuation of the company’s development asset at Radway Green, in Crewe.
As a result, Blackstone said it was not in a position to proceed with its offer on the financial terms of the final indicative proposal.
Warehouse REIT said its board is engaged with its financial advisers, its independent valuer and Blackstone to assess the merits of each of Blackstone’s points, as well as to highlight potential value accretive items which may not be reflected in Blackstone’s ongoing assessment.
To allow further time for these discussions, Warehouse REIT has requested, and the Takeover Panel has consented to, an extension of the current deadline of 5pm today (May 12) for Blackstone to either announce a firm intention to make an offer or announce that it does not intend to make an offer for Warehouse REIT.
Following the extension, Blackstone now has until no later than 5pm on May 30, to state its intentions.
Warehouse REIT had previously rejected an initial cash bid from Sixth Street Luxembourg Sarl and Blackstone Europe which valued it at £463m.
The company values its portfolio at £810.2m across 69 estates and enjoys a rent roll of £44.6m.
Last month it refinanced its lending with a new £200m term loan and a £100m revolving credit facility.
In its last set of results it posted sales 8.1% ahead of March 2024 book value, bringing total disposals for the first nine months of the financial year to £74.4m, 1.8% ahead of book value.
Earlier this year a positive quarter of leasing activity for the three months to December 31, 2024, saw the REIT complete 25 transactions, securing £3.5m of contracted rent and is continuing to successfully capture portfolio reversion, with transactions agreed on average 32.2% ahead of previous contracted rent.
On selling £12.8m of non-core asset sales in March this year, Warehouse REIT said it showed the industrial property market is showing signs of resilience.
Also in March it sold Swift Valley Industrial Estate in Rugby for £6.1m.
