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Blackstone agrees to acquire Dream Global REIT for CAD 6.2bn
Posted on Monday, 16 September 2019 09:43
Real estate funds management by Blackstone have agreed to pick up Canada’s Dream Global Real Estate Investment Trust (REIT) in an all-cash transaction worth CAD 6.20 billion (USD 4.67 billion).
Under the terms of the offer, the Toronto-headquartered and -listed business will receive CAD 16.79 per share, representing an 18.5 per cent premium to its close of CAD 14.17 on 13th September 2019, the last trading day prior to the announcement.
The deal will also represent a total return of 47.0 per cent, is subject to at least 66.0 per cent of the votes cast by stockholders, regulatory approvals and is expected to complete in December 2019.
Dream Global REIT created its portfolio at an average acquisition cap rate of around 6.8 per cent, including the Netherlands assets, valued at an 8.0 per cent transaction cap in 2017 and consisting of 200 properties in 100 cities across Western Europe.
The business was created in 2011 to invest in the region’s real estate and identified an opportunity to buy 292 buildings for CAD 1.00 billion, partly funded from its CAD 470.00 million initial public offering.
Dream Asset Management, a subsidiary of the target being acquired by Blackstone, is intended to be separated from the main company following completion.
In addition, Dream Global REIT is expected to announce plans related to its EUR 375.00 million senior notes due 2021 and the EUR 300.00 million senior notes due 2026 in due course.
The company recorded investment properties revenue of CAD 181.51 million, net rental income of CAD 130.64 million and earnings before interest, taxes, depreciation and amortisation of CAD 120.84 million in the six months ended 30th June 2019.
For Blackstone’s property unit, the news comes three months after agreeing to pick up GLP’s US logistics assets for USD 18.70 billion.
This deal is the largest to be announced in the entire real estate sector worldwide in 2019 to date, according to Zephyr, the M&A database published by Bureau van Dijk.
Capitaland acquired Ascendas and Singbridge of Singapore for SGD 10.91 billion (USD 7.94 billion) in the second biggest transaction.
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