Shares in Tritax Big Box REIT have fallen after the industrial investor confirmed merger talks with UK Commercial Property REIT, while the latter’s stock has risen.
Tritax Big Box closed down 4% at 153.8p. However, UKCM closed up 4.8%, at 67.3p.
Earlier today, the two investors said they had reached key terms on a £924m all-share merger, which would create a REIT valued at £3.9bn.
Notably, UKCM said its chair Peter Pereira Gray is not backing the deal, although the rest of the board is “minded to recommend” the deal to shareholders.
UKCM’s two biggest shareholders, Phoenix Life and Investec, have shown their “non-binding” support for the deal. The pair collectively own 56.5% of the REIT.
The news comes after Phoenix Life blocked plans for a merger with rival REIT Picton Property Income in November last year.
Separately, rival warehouse owner LondonMetric struck an all-share merger deal with LXi REIT last month.
According to Berenberg, the number of real estate companies on the London Stock Exchange has dwindled to its lowest level in more than two decades. Analysts warned that several of the remaining REITs are “uninvestable” unless consolidation continues.
The FTSE 100 ended the day static at 7,573 points, while the FTSE 250 closed at 19,203.
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