Starwood to buy RDI REIT in £468m take-private
Starwood Capital Group has agreed a £467.9m takeover of RDI REIT, the latest take-private deal to hit the London listed real estate market.
Starwood, which bought a near-30% stake in RDI last summer, will pay 121.35p per share, a 38.2% premium to the stock’s six-month average price and a 19.9% discount to RDI’s last reported EPRA NAV.
Announcing the deal, Starwood said RDI is “well managed and has an attractive and high-quality real estate portfolio” but added that the company has traded at a “persistent discount” to NAV during the past three years.
Starwood Capital Group has agreed a £467.9m takeover of RDI REIT, the latest take-private deal to hit the London listed real estate market.
Starwood, which bought a near-30% stake in RDI last summer, will pay 121.35p per share, a 38.2% premium to the stock’s six-month average price and a 19.9% discount to RDI’s last reported EPRA NAV.
Announcing the deal, Starwood said RDI is “well managed and has an attractive and high-quality real estate portfolio” but added that the company has traded at a “persistent discount” to NAV during the past three years.
“Given RDI REIT’s scale and constrained access to capital, Starwood therefore believes the next stage of RDI REIT’s evolution will be better suited to ownership under the control of Starwood,” the company said.
RDI REIT chairman Gavin Tipper said: “Collectively, the board has carefully assessed Starwood’s proposed offer, taking into account all relevant factors, including the company’s historic share price performance; the short- to medium-term outlook for the real estate sectors in which the portfolio is invested, in particular hotels and flexible workspace; and, given where we are in the cycle, the future ability of the management to effectively implement the portfolio strategy and recycle capital to deliver on the strategy in the current market.
“While the board believes in the quality of the portfolio and the strength of the management team, the significant uncertainty regarding a market recovery, strategy execution and any narrowing of the share price discount to NAV means that we believe recommending this cash offer provides certainty of value and is in the best interests of our shareholders.”
RDI REIT’s independent directors are being advised by JP Morgan Cazenove and Peel Hunt; Eastdil Secured is advising Starwood.
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Photo © RDI REIT
