LondonMetric continues to progress its UK-listed real estate market consolidation plan through its latest acquisition of Urban Logistics for £698.9m (€825m).
The UK real estate investment trust (REIT) said it will acquire Urban Logistics through a cash and share offer, by giving Urban Logistics shareholders 0.5612 new LondonMetric shares and 42.8p in cash for each of their shares.
The deal which values each Urban Logistics share at 150.3p each is a 21.8% premium to the last closing price per Urban Logistics share.
Following completion of the acquisition, which is being effected by means of a scheme of arrangement, existing LondonMetric shareholders will hold about 89% and Urban Logistics shareholders will hold about 11% of the combined group.
FTSE 100-listed LondonMetric has a market capitalisation of around £3.9bn and a £6.1bn property portfolio. FTSE 250-indexed Urban Logistics focuses on a sub-sector of the UK logistics real estate market, investing in mid-sized urban logistics buildings.
The combined group, with a pro forma market capitalisation of £4.4bn, will hold a £7.3bn portfolio of logistics, convenience, healthcare, entertainment and leisure assets, becoming UK’s leading triple-net-lease REIT.
Logistics will make up £4bn or 54.5% of the combined group’s portfolio on a pro-forma basis, the companies said.
LondonMetric has pursued a strategy of acquisitive growth since 2019 within the UK listed real estate market, including the purchase of A&J Mucklow in 2019, CT Property Trust Limited in 2023 and LXi REIT in January last year. LondonMetric is also progressing a recommended all-share acquisition of Highcroft Investments, expected to be completed on 21 May 2025.
Andrew Jones, chief executive of LondonMetric, said: “This is an excellent transaction that grows our urban logistics platform and supports our triple-net strategy. Urban warehousing remains our strongest conviction call for organic rental growth across the UK real estate market. The portfolio is well located, highly reversionary and our asset-management focus will ensure that it delivers reliable, repetitive and growing income-led returns.
“We have a demonstrable track record of successfully executing on M&A and we expect the transaction will deliver substantial synergies, cost savings and accelerated earnings growth. Our scale will continue to deliver enhanced access to capital, more debt optionality, increased share liquidity and larger investment opportunities.”
Nigel Rich, independent non-executive chairman of Urban Logistics, said the company had “assembled an exceptional portfolio of single-let, last mile assets and has outperformed the UK REIT sector and other relevant benchmarks” since its initial public offering in 2016.
Rich said: “The board of Urban Logistics believes that the acquisition offers Urban Logistics shareholders a premium price for their shares, an attractive combination of cash and share consideration and ongoing exposure to the logistics sector via a company of greater scale and liquidity.”
| Acquisition target | Year Completed | Deal Type | Value (£m) | Key Details | |||||
|---|---|---|---|---|---|---|---|---|---|
| A&J Mucklow | 2019 | Cash and share offer | 414.7 | ||||||
| CT Property Trust Limited | 2023 | All-share offer | 199 | ||||||
| LXi REIT | 2024 | All-share merger | 1,900 | ||||||
| Highcroft Investments | Expected 2025 | All-share offer | 43.8 | ||||||
| Urban Logistics | Proposed | Cash and share offer | 698.9 |
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