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public storage (New York Stock Exchange:PSA) made an unsolicited offer to buy rival Life Storage (New York Stock Exchange: LSI) for $11 billion in a stock deal.
Under the proposed transaction, Life Storage (LSI) holders would receive 0.4192 public storage shares (PSA) of common shares for each Life Storage share or unit they own, or $129 per share, representing a 17% premium to Life Storage’s closing price on Friday
“We have been disappointed that Life Storage’s board has refused to engage constructively with us,” Joe Russell, Public Storage president and chief executive officer, said in a statement Sunday. Life Storage explicitly wrote on December 29, 2022 that Life Storage is ‘not for sale’, reaffirmed that position in a letter dated January 31, 2023 without offering any avenue for further dialogue, and has not responded within our reach.”
Life Storage (LSI) confirmed in a press release that it received an unsolicited proposal for taxable shares from Public Storage (PSA) and that it will review the proposal, although the company noted that the proposal received on Sunday appears to be “substantially similar in all material aspects” to a privately submitted proposal previously reviewed by the LSI board.
Public Storage has a market capitalization of around $54 billion, while Life Storage (LSI) is valued at $9.5 billion.
Goldman Sachs is serving as financial advisor to Public Storage (PSA) and Wachtell, Lipton, Rosen & Katz is serving as legal counsel to Public Storage.
Public Storage (PSA) also announced Sunday that its board of directors increased Public Storage’s regular common quarterly dividend by 50%, from $2.00 to $3.00 per share.