Belgian self-storage specialist Shurgard has struck a takeover deal with rival UK self-storage group Lok’nStore worth around £378 mln (€442 mln).
Under the agreement, Lok’nStore shareholders are set to receive 1,110p per share, a premium of around 15.9% to the stock’s closing price of 958p on Wednesday.
The firms said in a joint statement that the merger would enable Shurgard to increase its footprint in the South East and Manchester, which it called 'the two most attractive target markets outside of London'.
Lok’nStore has a total of 43 properties across England and Wales.
Shurgard said that the total all-in cost of the acquisition is expected to be €613 mln, including secured development pipeline costs to be spent over the next 3 years of €83 mln, refurbishment capex of €13 mln and transaction costs of €32 mln.
Initially the acquisition will be financed 100% through a bridge facility, with Shurgard intending to take out the bridge with a mix of debt and equity in the future.
The takeover is subject to a vote among Lok’nStore’s shareholders, requiring at least 75% approval.
Marc Oursin, chief executive of Shurgard, commented: 'Following several successful acquisitions over the past year, I am excited to disclose this new acquisition in the UK, which doubles our presence in the country, and accelerates our growth and expansion strategy. This milestone event for Shurgard adds an additional 171,000 m2 MLA, representing two full years of Shurgard’s targeted annual expansion, with new ramp-up and development opportunities to accelerate our growth in existing and new UK markets.'
Andrew Jacobs, chair of Lok’nStore, added: 'Lok’nStore’s board believes the offer represents significant value for Lok’nStore’s shareholders, recognising the quality of Lok’nStore’s real estate portfolio and operational strength. Over the years Lok’nStore has built a unique portfolio of purpose-built self-storage assets. We believe that integrating Lok’nStore’s assets and operations into Shurgard is highly complementary considering Lok’nStore’s asset locations and positioning in its markets.'
Shurgard is the largest developer, owner and operator of self-storage facilities in Europe, opearing 1.4 million m2 of space across 276 stores in seven countries.
