The board of abrdn Property Income Trust Limited (API) has backed the all-share merger with Custodian Property Income REIT (CREI) over the rival offer tabled by Urban Logistics REIT.
In an update, the board of API said it had reviewed Urban Logistics’s bid and had confirmed to the REIT that it would not recommend its proposal to API shareholders if a firm offer were made on the terms proposed.
The board reiterated its belief the merger with CREI represents the best outcome for API shareholders and reiterated its recommendation that shareholders vote in favour of merger with CREI.
James Clifton-Brown, chair of API, said: “The API board has reviewed in detail the options available to API in the interests of all shareholders, including the competing merger proposals from CREI and Urban Logistics as well as a potential managed wind-down. Having completed its comprehensive assessment, the API board continues to believe that the CREI merger represents a strategically consistent and significant enhancement to the status quo for API shareholders.
“The CREI merger offers continued exposure to a diversified, income-focused strategy as well as the growth prospects of the enlarged portfolio. Furthermore, the CREI merger represents a premium to API’s undisturbed share price and brings an increase in dividends, full dividend cover and enhanced scale and liquidity for API shareholders.
“Accordingly, the API board unanimously reaffirms its recommendation that API shareholders vote in favour of the CREI merger at the shareholder meetings which will now be held on 27 March.”
David MacLellan, chairman of CREI, said: “We welcome the API board’s decision to maintain its recommendation for the all-share merger with CREI. The recommended merger will benefit shareholders of both companies by creating a well-positioned REIT of enhanced scale, with the opportunity to participate in the returns from the two complementary portfolios, as well as a fully covered and sustainable dividend.”
