Shares in Big Yellow rocketed on Monday morning after it emerged the London-listed business could be in line for a takeover from real estate investment giant Blackstone.
In a statement, the self-storage firm confirmed Blackstone was “considering its position in relation to the company, which could include a cash offer for the entire issued, and to be issued, share capital of the company.”
Blackstone’s evaluation was at a preliminary stage, Big Yellow said, adding that any plan for a deal could be impacted by the potential impact of the upcoming UK budget as it relates to the self-storage sector.
Big Yellow shares rose as much as 20 per cent to 1,154p by mid-morning on Monday. The FTSE 250 stock is up by around a quarter since the start of the year.
Dealmaking heating up
The potential takeover comes amid a period of intense dealmaking in the UK’s storage and logistics sector by New York-based Blackstone, which has vowed to invest billions into Britain.
Also on Monday, Blackstone confirmed it would acquire a 9 per cent stake in London-listed logistics business Tritax Big Box, as part of a property deal in which Big Box would acquire a portfolio of assets in the Midlands and the South East from the firm valued at just over £1bn. Blackstone also collected £632m in cash from the agreement, which Big Box planned to pay for via a new debt facility. Big Box shares rose 3.5 per cent to 147p.
The tie-up followed an intense bidding war between Big Box and Blackstone to acquire logistics firm Warehouse REIT over the summer months. Blackstone was ultimately triumphant, offering 115p a share for the company, in a takeover that valued Warehouse at just shy of £500m. The deal was agreed in September.
Blackstone last month pledged to invest at least £100bn into the UK over the next decade, doubling down on its bid to take over large swathes of British infrastructure and assets.
The pledge was announced during Donald Trump’s state visit to the UK, alongside a series of investment commitments by major US and UK businesses.