(Alliance News) - Retirement homes developer McCarthy & Stone PLC on Friday said it has agreed to a GBP630 million takeover from Mastiff Bidco, a subsidiary of Lone Star Real Estate Fund VI.
The offer values McCarthy & Stone shares at 115 pence each, a 39% premium to its Thursday closing price. Shares in McCarthy & Stone were up 41% at 116.80p each in London on Friday morning, valuing the company at GBP628.1 million.
"The McCarthy & Stone directors, who have been so advised by Rothschild & Co and Deutsche Bank as to the financial terms of the acquisition, consider the terms of the acquisition to be fair and reasonable," the company said.
McCarthy & Stone Chair Paul Lester said: "The McCarthy & Stone directors believe that the offer from Lone Star represents fair value for shareholders and unanimously intends to recommend the offer. The all-cash offer represents a compelling and attractive opportunity for shareholders to realise and crystallise their investment in McCarthy & Stone in the near term and also provides a meaningful premium to the prevailing share price notwithstanding the backdrop of the wider risks posed by the political and macro-economic environment.
"We believe that Lone Star would provide a complementary partner for McCarthy & Stone's stakeholders and along with the investment in the business that Lone Star can provide, will enable further improvements of its transformation strategy and allow McCarthy & Stone to capitalise on its growing rental and multi-tenure offering which would underpin the long-term growth of McCarthy & Stone."
Lone Star Real Estate Fund VI, a part of US-based private equity firm Lone Star, has received irrevocable undertakings to vote in favour of the merger in respect of 17% of McCarthy & Stone's share capital.
By Tapan Panchal; tapanpanchal@alliancenews.com
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