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PRS REIT, a Manchester-based real estate investment trust focused on family rental homes, has agreed to sell its operating company, PRS REIT Holding Company, to a fund advised by Waypoint Asset Management for about 646.2 million pounds (USD 881.2 million). Shareholders are set to receive a dividend of 1.1 pence per share for the first quarter of fiscal 2026, in addition to the sale proceeds. Competing interest from Long Harbour and U.S. private equity firm KKR did not lead to higher or firmer offers. The deal is expected to complete by the end of November, followed by the trust's voluntary liquidation.
PRS REIT has entered into non-binding heads of terms to sell its wholly-owned subsidiary, PRS REIT Holding Company, to a fund advised by Waypoint Asset Management. The subsidiary owns the trust's entire portfolio of private rented family homes. The proposed sale price is 646.2 million pounds, with expected net proceeds of about 633.2 million pounds after accounting for transaction-related expenses and taxes. Advertisement
Alongside the transaction, shareholders will receive a dividend of 1.1 pence per share for the first quarter of fiscal 2026, which is due for payment in November. The trust has clarified that this dividend is separate from the sale and will not reduce the agreed consideration.
The decision to sell follows a strategic review launched in October last year, when the company reshuffled its board, including the replacement of its chair. The review led to a formal sale process that attracted interest from several investors. U.S. private equity firm KKR joined the process earlier this month but did not submit a formal offer. Long Harbour, a property investment firm, had previously put forward a bid of about 631.6 million pounds.
PRS REIT explained that it had not received any proposal superior to Waypoint's, either in terms of value or certainty, and some alternatives were dependent on additional financing. The board stated that the proposed sale provided the clearest route to maximising cash returns for shareholders.
The announcement triggered a positive market response, with PRS REIT's shares rising around 9% to 114 pence in morning trade, making it the strongest performer on the FTSE midcap index on that day.
The proposed deal is still subject to confirmatory due diligence, finalisation of a sale and purchase agreement, and approval from shareholders through a special resolution. The company expects completion by the end of November. Once the sale is concluded, PRS REIT intends to seek shareholder approval for the voluntary liquidation of PRS REIT Plc, with net assets to be distributed to investors.
The agreement also includes a break fee of about 5.7 million pounds payable to Waypoint if PRS accepts a competing binding offer while the current negotiations are ongoing.
Source Reuters
5th Jun, 2025
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