PRS REIT has announced that it is undertaking a strategic review to consider the future of the company following shareholder pressure.

The review will explore all the various strategic options available to the company, which may include a potential sale.

This follows the requisition notice made by a number of shareholders to replace the chairman, Steve Smith, and another director with Robert Naylor and Christopher Mills. The shareholders were unhappy at the award of a multi-year investment management contract to current manager Sigma without proper shareholder consultation and the lack of action to narrow the company’s discount to NAV.

In September, Smith announced he would step down at the next AGM, while both Naylor and Mills were appointed to the board.

The board now says that it will explore available options to the company to maximise value for shareholders, alongside engaging with a range of potentially interested parties.

PRS REIT owns the largest build-to-rent single-family home portfolio in the UK, with 5,425 completed homes as at 30 September 2024, with an occupancy rate of 98% and an estimated rental value of £67.5m per annum.

The strategic review will be undertaken under the mechanism referred to in the Takeover Code as a “formal sale process”, which will enable conversations with parties interested in making a proposal to take place on a confidential basis.

The board said that it was not currently in discussions with, or in receipt of an approach from, any potential offeror.

Shareholders are advised that this announcement does not represent a firm intention by any party to make an offer and there can be no certainty that any offers will be made as a result of the formal sale process.