UK REITs London & Stamford and Metric Property Investments have announced that they are in the advanced stage of merger talks.
UK REITs London & Stamford and Metric Property Investments have announced that they are in the advanced stage of merger talks.
Under the deal being finalised shareholders of Metric - a specialist retail property investor - would receive 25% of the enlarged London & Stamford group, while a shareholders of London & Stamford - which invests in all main segments of UK real estate - would control 75%.
The exchange ratio would be 0.94 new London & Stamford ordinary shares for every 1 Metric ordinary share.
The companies said there would also be a 'significant return of capital' to both sets of shareholders following completion of the merger.
London & Stamford reported in its accounts for 2012 that it had a real estate portfolio valued at just over £1 bn (EUR 1.2 bn) and total investment firepower of about £900 mln. Metric had a portfolio valued at £238 mln at end-March this year.
It has been agreed in principle that Patrick Vaughan, CEO of London & Stamford, would become executive chairman of the combined group, with Andrew Jones, CEO of Metric, becoming CEO of the combined group if the merger is completed.
Martin McGann, finance director of London & Stamford would assume this role for the new company.
Raymond Mould, a co-founder of London & Stamford, has said that, upon completion of the merger, he intends to retire from his role as chairman of London & Stamford. He will be available as a consultant to the enlarged group for a period. Similarly, Sue Ford intends to retire from her role as finance director of Metric on completion of the merger
Metric CEO Andrew Jones commented: 'The proposed merger will create a larger REIT with scale, diversity and liquidity and brings together deep real estate knowledge, financial resources and management skills. Organisations across the world are deleveraging and we believe that this will continue to bring attractively priced assets to the market. We are excited by the prospect of being strongly positioned, with London & Stamford, to exploit these opportunities as they arise across the market.'
