Warehouse REIT has accepted a £470 million bid from Blackstone, revising its earlier valuation. The agreed price of 110.6 pence per share is a 34.2% premium over recent stock prices. The deal includes a 1.6 pence per share dividend, reflecting growing interest from U.S. firms in UK assets amidst challenging economic conditions.
In a notable development, UK-based Warehouse REIT has officially accepted a bid from Blackstone valued at 470 million pounds, or approximately $635.35 million. This comes after Blackstone, the global investment firm, adjusted its proposal due to valuation concerns that arose during due diligence. On Wednesday, the parties agreed on an offer price of 110.6 pence per share, which marks a substantial 34.2% premium compared to Warehouse REIT’s stock price as of February 28, right before Blackstone’s initial bid was publicly disclosed.
Interestingly, this engagement follows a prior increase in Blackstone’s bid to 489 million pounds back in March. However, it appears they later reconsidered, removing the extra incentive tied to the offer, pointing to differing assessments regarding the asset’s worth. It should be noted that the final offer price also includes a dividend of 1.6 pence per share, making the deal more appealing.
Neil Kirton, chair of Warehouse REIT, expressed insights into the company’s predicament. He noted that growth has been significantly hindered by unfavorable macroeconomic conditions, escalating interest rates, and challenges in securing new equity. Kirton emphasized that these pressing challenges render Blackstone’s offer particularly attractive in the current climate.
This acquisition trend is part of a larger pattern, with U.S. firms increasingly purchasing British assets, capitalizing on a market characterized by lower valuations and stagnant growth. In the recent past, several firms in the UK, including Dowlais and Deliveroo, have found themselves taken over by American competitors or investment organizations.
As a concluding note, this deal illustrates the ongoing dynamics in the investment world, especially regarding cross-border acquisitions, as economic conditions in the UK continue to shift.
The exchange rate currently stands at $1 equating to 0.7398 pounds.
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