UK REIT Segro has unconditionally agreed to acquire a further 74.9% of the share capital of the French urban warehouse specialist Sofibus Patrimoine for €313.71 per share.
Following its acquisition of a 19.5% interest in 2018 for €20.5 mln, or €138 a share, and upon completion of the transaction, Segro will own 94.4% of Sofibus.
By the end of Q1 next year, Segro plans to file a simplified mandatory tender offer for the remaining Sofibus shares, at the same price of €313.71 per share, and intends to implement a squeeze-out procedure in order to delist the company from Euronext Paris.
As a result, Segro will secure control of Sofibus’s property portfolio, therefore increasing its presence in the Paris urban warehouse market.
The shares are being acquired from the controlling shareholders of Sofibus (the “Hottinguer Concert Party”, owning 56.3% of the share capital, as well as from several minority shareholders, owning in aggregate 18.6% of the share capital. The transactions add to a total amount of nearly €179 mln, valuing 100% of the equity of Sofibus at €238.5 mln.
The price reflects a premium of 46.6% compared with the last closing price before this announcement (11 December 2020), and a premium of as much as 67.5% compared to the volume-weighted average price over the last three months.
Sofibus’s main asset is Parc d’Activités des Petits Carreaux (PAPC), a 149,900 m2 urban warehouse park in Bonneuil-sur-Marne, an established commercial area in close proximity to central Paris. The portfolio is 96% occupied and also includes 17 hectares of adjacent development land and a fully-let office building in Central Paris. Within the Income Statement for the financial year ended 31 December 2019, the Company reported passing rent of €12.6 mln and EBITDA of €9.7 mln.
David Sleath, Chief Executive of Segro, said: ‘This is a rare opportunity to significantly increase our exposure to urban warehousing in Paris which has long been a core market for Segro. Our local team has intimate knowledge of the Paris warehouse market and will deploy its expertise to add value by actively managing Sofibus’s existing assets and by developing new, state of the art warehousing on the adjacent plots of land to satisfy growing occupier demand.’
This transaction allows Segro to add critical mass to its Paris urban warehouse portfolio as it increases Segro’s urban warehouse assets in France by around one third. It also gives Segro access to land for further urban warehouse development projects in Paris.
Segro will finance the acquisition from cash and its existing debt facilities.
Segro is being advised by Lazard, acting as its sole financial adviser, and Archers, acting as its legal counsel.