Long Harbour has made an approach to acquire PRS REIT, which put itself up for sale earlier this year as part of a strategic review.
It is understood Long Harbour has secured backing from a major financial investor to table an offer for the REIT. Long Harbour has submitted a formal proposal, although it remains unclear at what price the offer has been pitched.
PRS REIT confirmed it received a non-binding proposal from Long Harbour for the entire issued and to be issued share capital of the company. Under the terms of the possible offer, PRS REIT shareholders would receive 115p per share in cash. Discussions between the parties are ongoing, with the PRS REIT board expecting to provide a further update on the formal sale process by the end of the month.
PRS REIT has attracted interest from several suitors since hoisting the “for sale” sign. The company is investing more than £1bn in a private rental housing portfolio outside major cities, and raised more than £500m through a flotation in 2017, followed by two further equity raises. Homes England, the government agency, is among PRS REIT’s backers.
Shares in PRS REIT were trading at around 117.4p on Wednesday, giving it a market capitalisation of approximately £640m. However, PRS REIT cautioned that there is no certainty a formal offer will be made, or as to the terms of any such offer.
Long Harbour’s possible bid comes under the company’s formal sale process, announced last October, which has included a dispensation granted by the Takeover Panel from the usual 28-day deadline under Rule 2.6(a) of the Takeover Code. This dispensation allows Long Harbour to participate in the process without the pressure of a set timetable for making a binding offer.
PRS REIT said further announcements will be made in due course and noted the latest statement was made without the consent of Long Harbour. Spokespeople for both parties declined to comment.
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