A consortium led by Brookfield Property Group is planning a $4 billion takeover of Australia's largest self-storage centre operator National Storage REIT (ASX: NSR), which represents a premium of more than $800 million based on the group’s last closing price.
Responding to media speculation that a takeover play was imminent, National Storage called for a trading halt on its shares this morning pending an announcement which was issued by the group this afternoon.
National Storage confirmed that it has received an unsolicited, indicative proposal from a consortium comprising Brookfield Property Group and its affiliates and the Singapore Government’s sovereign wealth fund subsidiary GIC Investments (Australia) Pty Ltd.
GIC is already a joint-venture partner with National Storage as majority investor in the $270 million National Storage Ventures Fund to develop and operate self-storage centres across Australia.
The fund, which was established last year, aims to develop an initial portfolio of 10 foundation assets sourced from the existing National Storage development portfolio. The partners agreed in June to tip in about $228 million as part of the second tranche of their investment in the fund.
The takeover offer announced today is priced at $2.86 cash per stapled security, a figure that includes a 6c-per-security distribution expected for the current half year.
The price compares with yesterday's close of $2.26, representing a 26.5 per cent premium to the group's market valuation of $3.17 billion.
“The indicative proposal follows earlier confidential, unsolicited, non-binding and indicative proposals from the consortium and a period of negotiation including the provision of limited due diligence,” says National Storage.
The group, which operates more than 280 storage centres in Australia and New Zealand, is providing the Brookfield consortium exclusive due diligence until 7 December 2025 in order to put forward a binding offer for the business.
National Storage says there is no certainty that a binding agreement will be proposed by the bidders.
The takeover proposal follows a strong run of growth for National Storage, which delivered underlying earnings of $164 million in FY25, up 6.4 per cent from a year earlier.
The listed investment trust lifted the number of centres it operates by 20 to 274 in FY25, boosting its portfolio to 1.52 million square metres of net lettable area.
This was driven by a $664 million investment in new acquisitions, completed developments and expansion opportunities.
“This is unrivalled in the Australian and New Zealand markets and underpins our exceptional and unique ability to identify, execute and capitalise upon key opportunities in the self-storage sector,” National Storage chair Anthony Keane told investors at the annual general meeting in October.
The portfolio has grown further since the end of June with the company identifying 50 current and potential development projects totalling 490,000 square metres of lettable area which will be brought online over the next two to three years.
By the end of FY25, National Storage lifted total assets by 12.6 per cent to $5.71 billion, while net tangible asset per security rose 2.4 per cent to $2.58. Based on this metric, the Brookfield offer is priced at a premium of 28c per stapled security.
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