The Abrdn Property Income Trust board reiterated its recommendation that shareholders vote in favour of a merger with Custodian Property Income REIT today (14 March).
The statement follows an update from Custodian REIT yesterday with further incentives for the merger, including the waiver of a £350,000 project fee and made the investment manager appointment terminable if given 12-month written notice.
API had postponed dealings with Custodian REIT in February, following a rival offer from Urban Logistics REIT. However, in today’s announcement, the API board said it confirmed to Urban Logistics it would “not recommend” the offer to shareholders if it was formally put forward.
The board also provided an update on the potential of a ‘managed wind-down’, and said while it remains a “less attractive” option than the CREI merger, the board would pursue this option if the merger was not approved. The potential of the winddown was called “more viable” than originally considered due to property market conditions.
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.”
