BWP Trust (ASX:BWP) released half-year results outlining the bid implementation deed takeover offer for Newmark Property REIT (ASX:NPR) to scale and increase the portfolio.
The merger will offer NPR security holders 0.4 BWP units for every 1.0 NPR security held. This represents an implied price of $1.39 per NPR security, and for NPR, it represents a total value of $246.8 million and a total enterprise value of $517.4 million.
BWP Financials
The total income for the period was $82.3 million, an increase of 4.7 per cent over the previous period. The $3.7 million increase in rental income was due to the annual rent increases and the rent contribution from properties acquired during the half.
BWP outlined increasing financial costs due to the weighted average cost of debt increase due to higher interest rates, with an average level of borrowings increasing from the previous corresponding period due to the acquisition of two properties during the period.
An interim distribution of 9.02 cents per ordinary unit has been declared. This is the same as the previous corresponding period (9.02 cents per unit).
Outlook
Beyond the merger, the Company is expected to review rents to contribute incrementally to property income for the half-year to 30 June 2024, with 59 leases to be reviewed. In addition, three market rent reviews of Bunnings Warehouses are in the process of being finalised and are expected to be completed during the second half.
In delivering the Trust’s strategic agenda of portfolio optimisation, profitable growth and portfolio renewal, the Trust’s primary focus for the balance of the 2023/24 financial year remains on progressing the repurposing of ex-Bunnings properties in the portfolio, filling any vacancies, progressing and completing store upgrades, extending existing leases with Bunnings through the exercise of options, completing market rent reviews, and the continued rollout of energy efficiency improvements at its properties.
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