Picton Property Income rules out offer for UK Commercial Property merger after shareholder opposition
Both trusts had until 6 December to state whether they have a firm intention to make an offer, or announce they do not intend to make an offer.
The move follows last month's announcement that UKCM's largest shareholder, Phoenix Life, would not back the possible all-share merger on the proposed terms, and the subsequent termination of discussions between both trusts.
In a stock exchange notice today (5 December), PCTN said the board continues to believe there were «strategic and financial» benefits to combining complementary businesses to enhance scale, diversification and efficiency within an internal management structure.
«Picton will continue to be proactive in pursuing opportunities that would add value for shareholders and build on the company's long-term track record of outperformance against the MSCI UK Quarterly Property index since launch in 2005,» it said.
UK Commercial Property REIT confirms merger 'discussions'
As required by the UK's takeover code, both trusts had until 6 December to state whether they had a firm intention to make an offer, or announce they do not intend to make an offer.
The possible merger was intended to be on an European Public Real Estate Association Net Tangible Assets (EPRA NTA) for EPRA NTA basis, which relates to all properties at their market value, but excludes the mark to market of financial instruments, deferred tax and intangible assets, in a bid to provide a consistent measure of tangible NAV on a going concern basis.
In a research note, Numis analyst Andrew Rees said last month the merger would have seen the combined trust internally managed, as Picton is, rather than the current external management structure of UKCM.
UK Commercial Property REIT merger with Picton dropped on
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