Christian Mayes, PORTFOLIO ADVISER, 20 MARCH 2024:
Abrdn Property Income Trust’s (API) sale of two assets at book value ‘casts doubt’ on the merits of its proposed merger with Custodian, according to QuotedData analysts.
In a stock exchange announcement this morning (20 March), the trust announced the sale of two properties for a combined £16.6m, representing a 0.3% discount to the portfolio’s December valuation.
Mark Blyth, deputy fund manager of API, said the two sales continue the trust’s disposal strategy implemented at the end of last year, with the proceeds being used to pay down its rolling credit facility.
“It follows on from the sale in December of the industrial asset in Livingston and demonstrate the continued appeal of the API assets to investors at prices close to NAV,” he said.
QuotedData analysts argued, however, that the sale poses questions over the benefits for shareholders from its proposed merger with Custodian Reit.
“We are not sure why API shareholders would vote for a merger with CREI at this current price when these sales prove that a managed wind-down would be of far greater value – even before the positive impact of any potential drop in interest rates later this year and into 2025,” analysts said.
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