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Lok’nStore is set to become the latest company to leave the UK stock market, after the self-storage group agreed to be bought by Belgian-listed rival Shurgard for £378mn.
Shurgard, which describes itself as “the largest developer, owner and operator of self-storage facilities in Europe”, said it would pay 1,110p per share in cash to acquire Lok’nStore — a 15.9 per cent premium to the company’s closing price on Wednesday.
Lok’nStore’s share price climbed 18 per cent to a new high of 1,130p in early trading on Thursday, higher than the offer price. Shurgard’s shares were up 0.74 per cent.
In a joint statement, the groups said the deal would give Shurgard a bigger presence in the south-east and Manchester, the “two most attractive target markets outside of London”, and where the majority of Lok’nStore’s 52 UK branches are based.
The takeover would leave Brussels-listed Shurgard with 100 branches in Britain — a similar footprint to rival Big Yellow, the second-biggest storage provider in the UK behind Safestore.
Shurgard chief executive Marc Oursin said the acquisition “doubles our presence in the country, and accelerates our growth and expansion strategy”.
Lok’nStore’s directors have unanimously recommended the offer to shareholders, who will vote on the takeover in May. The company said its share price had not “consistently or fully reflected its achievements or growth potential”. This offer represents a 2.3 per cent premium to its previous all-time high closing price of 1,085p in January 2022.
The storage group is the latest UK company to have been taken over in recent months, in a climate in which British stocks are trading at steep discounts to their US peers. Market expectations that interest rates will fall this year, and improved confidence on the UK’s economic outlook have helped contribute to a recent spate of bidding wars.
Shurgard, which is valued at €4bn and had 301 stores in seven countries at the end of last year, has been on an expansion spree for the past few years, with a particular interest in acquisitions in London.
Lok’nStore reported revenue of £27.1mn for the 12 months to the end of July, up marginally from £26.9mn the year before, while its operating profit fell 22 per cent year on year to £8.9mn.
Oursin said in an interview that the south-east and Manchester were attractive target areas because “the south-east has 9mn people and the highest income per resident outside London, and Manchester is the second largest metropolitan area”.
The deal means UK properties will make up 25 per cent of Shurgard’s overall portfolio. Belgium and the Netherlands make up the biggest segment, at 28 per cent.
KBC Securities said in a note to clients: “As a natural consolidator in an undersupplied market, Shurgard’s growth potential is huge.”
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