Life Storage said an $11bn (€10.2bn) bid from NYSE-listed rival Public Storage ”undervalues” the company, as it rejected the acquisition proposal.
Earlier this month, Public Storage, the largest operator of self-storage properties in the US, called on Life Storage’s board to engage in discussions regarding the proposed bid that was first made privately to Life Storage in a 12 January letter.
Life Storage said the company’s board of directors unanimously concluded that the acquisition proposal “significantly undervalues Life Storage and its prospects for future growth and value creation”.
Mark G Barberio, non-executive chairman of the Life Storage board, said: “After further and careful consideration, the Life Storage board of directors continues to believe that Public Storage’s proposed exchange ratio significantly undervalues the company, and that the proposal is not in the best interests of shareholders.
“The board believes Life Storage will deliver greater risk-adjusted total shareholder returns as a standalone company than through the proposed transaction.
“The board is always open to and regularly evaluates opportunities to enhance shareholder value and will consider any proposal that appropriately values the company and its prospects.”
Joseph Saffire, Life Storage’s CEO, said: “Life Storage has a strong platform for continued growth with a diversified portfolio in high-value, fast-growing markets and a best-in-class operating platform including leading customer service and technology solutions.
“The company’s successful execution has resulted in industry-leading same-store performance, expanding operating margins and a strong balance sheet. Importantly, Life Storage is positioned to build on its momentum with accelerating top-line and FFO growth supported by pricing power, multiple revenue drivers and prudent cost management.”
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