South African billionaire, US operator bid for $2b storage business
South African billionaire Nathan Kirsch with US-listed Public Storage are seeking to buy out Abacus Storage King.
The non-binding proposal of $1.47 per unit – a 31 per cent premium to the ($1.16) closing price – values the company at $1.93 billion.
Mr Kirsch’ Ki Group already controls c59.5pc via a direct investment in ASK and another in Abacus Group, which has held a 19.77pc stake since 2018, when it bought into the Storage King business.
Abacus, owned by a number of groups, led by Steven Sewell and Myra Salkinder, also manages the ASK portfolio: 126 properties, the management of 75 more licensed outlets, and 21 development sites.
Another offshore operator to enter local market
Any Ki Group/Public Storage deal would deliver 50:50 ownership via a privatised managed trust.
The deal also include management; bringing Public to Australia (in Europe the group controls the listed Shurgard Self Storage portfolio, with 240 outlets).
Ki Group chief executive officer, Bradley Fried, said Abacus Storage King, which Abacus Group spun off from Storage King in 2023, has underperformed relative to its peers (story continues below).
Amongst its rivals is Warburg Pincus backed Singapore based StorHub which has been an active purchaser of product to occupy since arriving here in 2022.
“The demerger…has failed to deliver the promised value for securityholders and the entity security price has declined 18pc since then delivering negative annualized total security return of -7pc,” according to the executive.
The S&P ASX 200 REIT index return, he added, was 11pc.
“With a free float of 39pc, the entity faces structural impediments which not only inhibit its ability to grow but may cause further deterioration,” Mr Fried said.
“[Our] proposed bid…presents securityholders with an opportunity to immediately realise value and create a more viable path forward for the company’s future,” he added.
Mr Kirsch, with a c$11b net worth, owns US-based Jetro Holdings, which supplies restaurant goods and services in the United States.
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