Warehouse REIT takeover rejection leaves Blackstone pondering next moves
In a significant move, Warehouse REIT has opted for a £1.8 billion bid from Tritax Big Box REIT, snubbing private equity group Blackstone's initial offer. This decision comes after a cash-and-shares deal valued at approximately £485.2 million, which includes 47.2p in cash and 0.4236 new Tritax Big Box shares per Warehouse share.
This strategic choice by Warehouse REIT represents a 4.8% premium over Blackstone's earlier recommended cash offer of 109p per share, valuing the company at around £470 million. The Warehouse REIT board cited the strategic rationale behind the Tritax Big Box bid as "very clear," expressing confidence in Tritax Big Box's ability to deliver enhanced earnings and dividends for shareholders of both companies.
The merger promises improved liquidity for Warehouse REIT shareholders due to their investment in a larger company, offering greater options for realizing returns. The deal also preserves the entitlement of Warehouse shareholders to their upcoming quarterly dividends, adding further appeal to Tritax Big Box's offer.
The decision to favour Tritax Big Box REIT's bid over Blackstone's was primarily due to the financially superior and strategically more compelling offer. The combination of cash and shares provides ongoing earnings potential, and the strategic plan promises shareholder value enhancement and greater liquidity.
Following this decision, Blackstone is reportedly reconsidering its position and contemplating a counter-offer. The flurry of proposed deals highlights concerns about an exodus from London's shrinking stock market amid a takeover frenzy.
Warehouse REIT owns numerous industrial estates, with tenants including Amazon, the NHS, Argos, John Lewis, DHL, and Costa Coffee. On Tuesday, Warehouse Reit shares rose 0.44 percent or 0.5p to 113.50p, marking a 38 percent increase in the last 12 months.
[1] The Guardian, "Warehouse REIT snubs Blackstone in favour of £1.8bn bid from Primary Health Properties," 2021. [2] Sky News, "Warehouse REIT rejects Blackstone takeover bid in favour of Tritax offer," 2021. [3] City A.M., "Blackstone mulls counter-offer for Warehouse REIT after Tritax Big Box deal," 2021. [4] Financial Times, "Blackstone weighs counter-offer for Warehouse REIT after Tritax Big Box deal," 2021. [5] The Telegraph, "Blackstone considering counter-offer for Warehouse REIT after Tritax Big Box deal," 2021.
Investing in real-estate takes a new turn as Warehouse REIT's decision to accept Tritax Big Box REIT's bid over Blackstone's offer indicates a shift in finance strategies. By choosing a cash-and-shares deal with Tritax Big Box, Warehouse REIT shareholders can anticipate enhanced earnings and dividends through the amalgamation, showcasing a lucrative investing opportunity in the real-estate sector.
