UPDATE: Glenstone calls for Alternative Income support as AEW exits

Glenstone REIT PLC on Wednesday repeated its call for shareholders of Alternative Income REIT PLC to accept its takeover offer, after rival suitor AEW UK REIT PLC confirmed that it would not be making an offer.

“Glenstone’s offer stands as the only offer capable of acceptance by AIRE shareholders, following AEWU’s withdrawal,” Glenstone said on Wednesday.

Glenstone had supported a previous offer from AEW, which did not go through. AEW had until Friday to declare whether it intended to make a firm offer, and said on Wednesday that it no longer intended to do so.

AEW is London-based real estate investment trust focused on UK commercial properties. It cited opposition from Glenstone as part of its decision to withdraw from the bidding pool.

AIRE, a real estate investment trust focused on specialised alternative property sectors, had preferred AEW to Glenstone, saying in July that AEW’s all-share tilt implied a value of 77.4 pence per share.

Glenstone is offering 71.4 pence per share, comprising 70.0 pence in cash plus AIRE shareholders’ entitlement to retain the 1.4 pence fourth-quarter dividend.

As of Monday, Glenstone reported that its own offer, which requires acceptances representing more than 50% of AIRE’s voting rights, said it had received valid acceptances for 1.92 million shares, representing 2.4% of AIRE’s issued share capital.

Glenstone already owns 20.4 million shares, or 25.4% of the company, including acceptances for shares covered by an irrevocable undertaking from director Adam Smith, but none for the 4.52 million shares subject to a letter of intent from Hawksmoor Investment Management.

However, according to AIRE, acceptances for Glenstone’s offer from “independent” shareholders remains below 0.025%. That figure excludes the shares held by Glenstone and concert parties, as well as the shares subject to Smith’s irrevocable undertaking.

On Wednesday, Glenstone insisted that its offer provides “a fair exit opportunity”.

“Glenstone does not share the AIRE board’s views on AIRE’s prospects as a standalone company, given that it is sub-scale REIT. Furthermore, the AIRE board has now failed to provide an alternative exit capable of acceptance by AIRE shareholders,” Glenstone commented.

AIRE shareholders have until 13:00 BST on September 4 to submit acceptances for Glenstone’s bid.

Shares in AIRE fell 1.0% to 69.61p each on Wednesday afternoon in London. AEW shares were up 0.2% at 106.00p.

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