Starlight Bidco, a Starwood Capital bidding vehicle, said on Wednesday that it has reached agreement on a £673.5 mln (€800 mln) all-cash offer for Balanced Commercial Property Trust in another major potential M&A deal.
Under the terms of the acquisition, BCPT shareholders will be entitled to receive 96.00 pence in cash for each BCPT share, representing a 21.5% premium to the closing price of 79.00 pence per BCPT share on 12 April 2024, being the last business day prior to the commencement of the offer period, and a discount of 8.7% to BCPT's last reported NAV per BCPT share of 105.1 pence as at 30 June 2024.
BCPT launched a strategic review in April as it faced significant challenges with a difficult economic and property market backdrop in a higher interest rate environment. As part of the strategic review, BCPT reviewed a total of 12 indicative offer proposals and decided to unanimously recommend the Starwood bid.
'The BCPT board believes the acquisition enhances value for BCPT shareholders, with the cash consideration representing a material premium to BCPT's undisturbed share price,' the company said in a statement.
Starwood has so far received irrevocable undertakings from BCPT shareholders and directors representing roughly 26% of the company's share capital. In order to go through, the deal will have to be approved by a majority in number representing 75% or more in value of the votes cast by shareholders.
Commenting on the acquisition, Paul Marcuse, Chairman of BCPT said: 'Over the course of the Strategic Review, we have undertaken an open consultation process with shareholders and the BCPT Board is grateful for the constructive feedback. We note that a significant proportion of the share register expressed to us a clear preference for a liquidity event, either via a sale or a managed wind-down.'
He continued: 'The BCPT Board has explored a range of potential options for the company, including continuation with a revised strategy, a managed wind-down of the portfolio and the partial or full sale of BCPT's share capital or assets. Following careful consideration, and having taken independent third-party advice, we believe that the proposed transaction with Starwood offers a successful outcome for our shareholders, offering a full cash exit at a significant premium to BCPT's undisturbed share price.'
Matthew Parrott, managing director of Starwood added: 'This acquisition by controlled affiliates of the Starwood Capital Group will increase our exposure to logistics and other high-conviction sectors and we look forward to supporting BCPT through our access to capital, scale, and operational expertise.'
