API offloads majority of portfolio to GoldenTree in £351m deal

27th Sep 2024 11:40

(Sharecast News) - Abrdn Property Income Trust is to sell the vast majority of its portfolio to Travelodge's US owner GoldenTree Asset Management, it was confirmed on Friday.

The asset manager has agreed to buy the London-listed trust's wholly-owned subsidiary, Abrdn Property Holdings, in a £351m deal.

Under the terms, GoldenTree will acquire 39 properties across the entire portfolio. The only exception is land at Far Ralia in the Cairngorms national park, which API said was being "actively" marketed. The 1,462 hectare-estate is currently being advertised for sale at £12m.

Earlier this year, shareholders voted against API being taken over by Custodian Property Income Reit, prompting management to seek approval to wind down the trust instead. Investors backed the proposal at a general meeting in May.

James Clifton-Brown, chair, said: "Since the shareholder vote...the board, alongside the investment manager, explored the most effective means of disposing of the company's assets. The aims were to maximise the returns to shareholders but also to return cash to them as soon as possible.

"The board considered the GoldenTree bid provided the best solution for shareholders, compared with the net present value of what might be achieve by of individual sales over a longer period and represents a swift implementation of the...managed wind down."

The trust said the deal represented a discount of 8% to API's external valuation of the portfolio as at 30 June of £381.6m, and implied a pro-forma net asset value of £244m, equivalent to 64p per share once adjusted for transaction costs.

GoldenTree has paid a 10% deposit, with the rest payable upon completion. The sale is currently due to complete on 29 November.

As at 1245 BST, shares in API were up 2% at 61.4p.