Life Storage Board of Directors Unanimously Rejects Unsolicited Proposal from Public Storage
16 Febbraio 2023 - 10:30PM
Business Wire
Board Determined Proposal Significantly
Undervalues the Company and its Future Growth Prospects, and Is Not
in the Best Interests of Life Storage and its Shareholders
Life Storage, Inc. (NYSE:LSI), a leading national owner and
operator of self-storage properties, today announced that the
Company’s Board of Directors unanimously concluded that the
acquisition proposal submitted by Public Storage on February 5,
2023, significantly undervalues Life Storage and its prospects for
future growth and value creation. This determination follows a
comprehensive review process conducted by the Life Storage Board in
consultation with its independent financial and legal advisors.
As previously announced, Public Storage proposed to acquire in a
taxable transaction all of the outstanding shares and units of Life
Storage for 0.4192 shares of Public Storage common stock for each
outstanding Life Storage share or unit. Based on the closing price
of Public Storage common stock on Wednesday, February 15, 2023, the
proposal had an implied value of approximately $126.14 per share or
unit or an equity value of approximately $11 billion.
Mark G. Barberio, Non-Executive Chairman of the Life Storage
Board, said, “After further and careful consideration, the Life
Storage Board of Directors continues to believe that Public
Storage’s proposed exchange ratio significantly undervalues the
Company, and that the proposal is not in the best interests of
shareholders. The Board believes Life Storage will deliver greater
risk-adjusted total shareholder returns as a standalone company
than through the proposed transaction. The Board is always open to
and regularly evaluates opportunities to enhance shareholder value
and will consider any proposal that appropriately values the
Company and its prospects.”
Joseph Saffire, Life Storage’s Chief Executive Officer, said,
“Life Storage has a strong platform for continued growth with a
diversified portfolio in high-value, fast-growing markets and a
best-in-class operating platform including leading customer service
and technology solutions. The Company’s successful execution has
resulted in industry-leading same-store performance, expanding
operating margins and a strong balance sheet. Importantly, Life
Storage is positioned to build on its momentum with accelerating
top-line and FFO growth supported by pricing power, multiple
revenue drivers and prudent cost management.”
In making the determination to reject the Public Storage
proposal, the Life Storage Board considered a number of factors,
including:
- Public Storage’s proposal significantly undervalues Life
Storage and the Company’s prospects for value creation. Life
Storage believes the proposed transaction is an opportunistically
timed attempt to transfer Life Storage's upside potential to Public
Storage’s shareholders. Life Storage has a strong track record of
value creation, with industry-leading total shareholder returns of
nearly 100% and quarterly dividend growth of 80% since March 2019,
when Mr. Saffire was appointed CEO of the Company. The Company
expects to continue to drive superior shareholder value as it
executes against its strategic pillars.
- The Company’s operating strategy and execution have resulted
in best-in-class performance in attractive, rapidly growing
markets. Over the past three years, Life Storage has
demonstrated sector-leading operating performance, including
average same store revenue and NOI growth of 9.6% and 13.0%,
respectively. Since the beginning of 2019, Life Storage has grown
same store rates per occupied square foot by nearly 38%, which
outpaces the peer average. Life Storage is well positioned to
deliver strong profitable growth given the Company’s financial
discipline, best-in-class operating model and multiple revenue
drivers, including acquisitions, third-party management, joint
ventures, lease-ups and expansions.
- Life Storage’s size and dynamic operating platform allow it
to scale its portfolio faster and more efficiently than Public
Storage. Given its asset base, the Company is positioned to
grow FFO per share faster than Public Storage. Life Storage’s
leading third-party management platform and joint venture
relationships also allow it to maintain a robust pipeline of
potential future acquisitions at attractive valuations. Utilizing a
strong and low leveraged balance sheet, Life Storage has increased
its total store count by nearly 50% since the beginning of 2019,
outpacing Public Storage’s ~19% store growth over that time.
Additionally, the Company has a strong track record of improving
properties to achieve compelling returns through its “expansion and
enhancement” initiatives. These investments have yielded ROI in the
double digits and significantly improved property NOI margins. This
allows Life Storage to significantly improve the value of its
properties to drive enhanced profitability and value for
shareholders.
- Life Storage has significantly expanded its operating
margins and has numerous initiatives underway to build on its
progress. Since the beginning of 2019, Life Storage has
improved same-store NOI margins by approximately 590 basis points,
which compares favorably to Public Storage’s ~210 basis points
margin improvement over the same period. The Company’s leading
technology solutions, including the pioneering mobile RentNow
platform, provide Life Storage with first mover advantage to
improve operating margins and reduce operating expenses while
maintaining the customer experience. These initiatives are expected
to drive additional margin uplift. Life Storage also operates in
attractive, rapidly growing markets. Any margin comparisons should
reflect the geographical distribution of respective portfolios as
well as variations in regional rental rates, operating approaches
and tax laws.
Life Storage will provide further detail regarding the Board’s
decision, its strategic progress and its financial outlook during
its fourth quarter and full year 2022 earnings call, which will now
be held on Friday, February 24, 2023, at 8:00 a.m. Eastern Time.
The call was previously scheduled to begin at 9:00 a.m. Eastern
Time.
Wells Fargo Securities and BofA Securities are acting as
financial advisors to Life Storage and Hogan Lovells US LLP and
Quinn Emanuel Urquhart & Sullivan LLP are serving as legal
advisors.
Forward-Looking Statements When used herein, the words
“intends,” “believes,” “expects,” “anticipates,” and similar
expressions are intended to identify “forward-looking statements”
within the meaning of that term in Section 27A of the Securities
Act of 1933 and in Section 21E of the Securities Exchange Act of
1934.
All forward-looking statements involve known and unknown risks,
uncertainties and other factors, which may cause our actual
results, performance or achievements of the Company to be
materially different from those expressed or implied by such
forward-looking statements. We may also make additional
forward-looking statements from time to time. All such subsequent
forward-looking statements, whether written or oral, by us or on
our behalf, are also expressly qualified by these cautionary
statements. All forward-looking statements apply only as of the
date made. We undertake no obligation to publicly update or revise
forward-looking statements which may be made to reflect events or
circumstances after the date made or to reflect the occurrence of
unanticipated events.
There are a number of risks and uncertainties that could cause
our actual results to differ materially from the forward-looking
statements contained herein. Any forward-looking statements should
be considered in light of the risks referenced in the “Risk
Factors” section included in our most recent Annual Report on Form
10-K and Quarterly Reports on Form 10-Q. Such factors include, but
are not limited to:
- adverse changes in general economic conditions, the real estate
industry and in the markets in which we operate;
- the effect of competition from new self-storage facilities or
other storage alternatives, which would cause rents and occupancy
rates to decline;
- impacts from the COVID-19 pandemic or the future outbreak of
other highly infectious or contagious diseases on the U.S.,
regional and global economies and our financial condition and
results of operations;
- potential liability for uninsured losses and environmental
contamination;
- the impact of the regulatory environment as well as national,
state, and local laws and regulations including, without
limitation, those governing real estate investment trusts
(“REITs”), tenant reinsurance and other aspects of our business,
which could adversely affect our results;
- loss of key personnel;
- the Company’s ability to evaluate, finance and integrate
acquired self-storage facilities on expected terms into the
Company’s existing business and operations;
- the Company’s ability to effectively compete in the industry in
which it does business;
- disruptions in credit and financial markets and resulting
difficulties in raising capital or obtaining credit at reasonable
rates or at all, which could impede our ability to grow;
- the Company’s existing indebtedness may mature in an
unfavorable credit environment, preventing refinancing or forcing
refinancing of the indebtedness on terms that are not as favorable
as the existing terms;
- interest rates may increase, impacting costs associated with
the Company’s outstanding floating rate debt, if any, and impacting
the Company’s ability to comply with debt covenants;
- exposure to litigation or other claims;
- risks associated with breaches of our data security;
- the regional concentration of the Company's business may
subject the Company to economic downturns in the states of Florida
and Texas;
- the Company’s cash flow may be insufficient to meet required
payments of operating expenses, principal, interest and dividends;
and
- failure to maintain our REIT status for U.S. federal income
purposes, including tax law changes that may change the taxability
of future income.
The forward-looking statements are based on our beliefs,
assumptions and expectations of our future performance, taking into
account all information currently available to us. These beliefs,
assumptions and expectations are subject to risks and uncertainties
and can change as a result of many possible events or factors, not
all of which are known to us. If a change occurs, our business,
financial condition, liquidity and results of operations may vary
materially from those expressed in our forward-looking statements.
You should carefully consider these risks before you make an
investment decision with respect to our securities.
ABOUT LIFE STORAGE, INC.: Life Storage, Inc. is a
self-administered and self-managed equity REIT that is in the
business of acquiring and managing self-storage facilities. Located
in Buffalo, New York, the Company operates more than 1,100 storage
facilities in 37 states and the District of Columbia. The Company
serves both residential and commercial storage customers with
storage units rented by month. Life Storage consistently provides
responsive service to more than 675,000 customers, making it a
leader in the industry. For more information visit
https://invest.lifestorage.com/.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230216005788/en/
Life Storage, Inc. Brent Maedl 716.328.9756
bmaedl@lifestorage.com
Andrew Siegel / Dan Moore Joele Frank, Wilkinson Brimmer Katcher
212.355.4449
Innisfree M&A Incorporated Scott Winter / Gabrielle Wolf
212.750.5833
Grafico Azioni Life Storage (NYSE:LSI)
Storico
Da Apr 2024 a Mag 2024
Grafico Azioni Life Storage (NYSE:LSI)
Storico
Da Mag 2023 a Mag 2024