Londonmetric Shares Fell on the Potential Merger With LXi REIT

The Londonmetric Property PLC (LON: LMP) share price fell 0.59% after confirming media speculation that it was in talks to potentially merge with LXi REIT Plc in an all-share transaction worth approximately £3.9 billion. In this scenario, LondonMetric would acquire all existing and future ordinary shares of LXi. 

Formulating a formal offer by LondonMetric is contingent on several preconditions, which can be waived at LondonMetric's discretion. These conditions include the completion of mutual due diligence, obtaining necessary consents, waivers, and approvals from each company's lenders, and receiving a recommendation for the Possible Merger from LXi's board to its shareholders.

LondonMetric and LXi boards recognise the opportunity to combine two companies with complementary strategic approaches. Their shared focus is generating consistent income-driven total shareholder returns throughout economic cycles.

The Potential Merger would lead to the formation of a substantial UK-focused triple net lease Real Estate Investment Trust (REIT) with a pro forma gross asset value of approximately £6.4 billion and a market capitalisation of approximately £3.9 billion. 

The consolidation is anticipated to enhance share liquidity and improve capital access. The merged portfolio would be well-aligned with structurally supported sectors, boasting roughly 93% exposure to logistics, healthcare, convenience, entertainment, and leisure. Additionally, it would offer robust income longevity and security.

The resulting entity would be an internally managed REIT, bringing about economies of scale and operational efficiencies, all while targeting sustainable earnings and dividend growth.

It's important to note that there is no certainty regarding the eventual formulation of a formal offer, and the terms of such an offer remain undetermined at this stage. Further updates will be provided as the situation develops.

The merged entity will be internally managed, creating opportunities for economies of scale and operational efficiencies. A primary objective will be to pursue sustainable earnings and a progressive dividend strategy. The company's central emphasis will remain on delivering consistent income-driven total shareholder returns with a compounding effect.

Londonmetric share price. 

The Londometric share price fell by 0.59% to trade at 194.10p from Monday’s closing price of 195.25p.