Inside of warehouse
Tritax Big Box merger with Warehouse REIT to create sector giant / Image Source: Adobe
  • Small premium to Blackstone offer
  • Combined £7.4 billion of assets
  • Deal offers ongoing REIT exposure

The takeover frenzy in listed real estate took another turn today with the news Tritax Big Box (BBOX) had reached agreement with Warehouse REIT (WHR) on a cash and shares deal, less than a fortnight after the latter had agreed terms with funds managed by Blackstone.

The higher offer from Tritax Big Box lifted shares in Warehouse REIT by 6p or 6% to 113p against Blackstone’s 110.6p offer, which includes a 1.6p third interim dividend.

‘COMPELLING’ REASONS

The Tritax Big Box offer consists of 47.2p in cash and 0.4236 new shares, plus the 1.6p interim dividend, which based on last night’s closing price implies a value of 114.2p per Warehouse REIT share.

The two boards argue there is a ‘compelling strategic and financial rationale’ for the tie-up, given Tritax Big Box’s existing strategy and ‘proven track record of delivering attractive and sustainable returns for shareholders’.

Putting the two firms together would create the number one listed UK logistics platform with £7.4 billion of assets and provide shareholders with better liquidity, a lower cost of capital and ongoing exposure to an attractive area of the commercial property market.

Warehouse REIT, which earlier this month (11 June) posted a 22% increase in pre-tax profit and an NAV total return of 8% for the year to March 2025, admitted in its earnings statement that the lack of liquidity in its shares, along with the persistent discount to net asset value, were the main reasons for accepting the earlier Blackstone offer.

EXPERT VIEW

Shore Capital analyst Andrew Saunders called the deal ‘a good outcome for both sets of shareholders’ as it allows Warehouse REIT holders to remain invested in a leading industrial and logistics platform while giving those in BBOX the opportunity to benefit from enhanced portfolio scale.

Saunders suggested the enlarged Tritax Big Box would most likely become a FTSE 100 constituent, while other benefits of the deal include cost savings and synergies, which should be earnings-accretive in the first full year, and the ability to bring the Warehouse REIT development site at Radway Green to fruition.

‘We are supportive of this acquisition and believe Warehouse shareholders should accept it,’ concluded the analyst.

LEARN MORE ABOUT TRITAX BIG BOX

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Issue Date: 25 Jun 2025