Balanced Commercial Property Trust Limited (BCPT) has announced a comprehensive strategic review to assess the company's future and maximize shareholder value. Given the difficult economic and real estate market situation, the BCPT Board is considering various options, including a potential sale, although no negotiations with buyers are currently underway. This is stated in the media reports.
Following the very difficult period of the Covid-19 pandemic and subsequent economic and geopolitical events, BCPT repositioned its portfolio from less attractive sectors and realized cash to facilitate strategic options for the company.
Despite the recent improvement in the rating of the company's shares, the share price remains at a significant discount to the value of the company's net assets. The company has launched this strategic review to determine the best way to increase value for shareholders.
Since its inception, BCPT has sought to provide shareholders with both income and growth through a diversified portfolio of commercial real estate in the UK. The company's results deserve attention: it surpasses the MSCI UK Quarterly Property index in several time intervals until December 31, 2023.
In line with its progressive dividend policy, BCPT increased its monthly dividends by 10% in October 2023, yielding a dividend yield of 6.7% as of April 12, 2024.
The company's investment manager, with the support of an independent board of directors, strategically reduced the impact of the lagging office sector, increasing the importance of the industrial portfolio. The upcoming annual report will shed light on these asset management solutions and the company's ESG initiatives.
As part of a strategic financial move, BCPT has received a new line of credit to keep its L&G loan at a competitive price while adding flexibility for future endeavors. This financial restructuring is taking place against the background of the company's preparations for a mandatory vote on continuing operations in 2024.
The strategic review will consider all possibilities, including the sale of the portfolio, the return of capital, a change in investment strategy or even the complete sale of the company in accordance with the city code of acquisitions and mergers. The takeover panel has allowed confidential negotiations with potential buyers, freeing them from public identification and strict deadlines.
Interested parties are encouraged to contact Barclays Bank PLC to express their interest. The BCPT Board emphasizes its right to change or terminate the review process at any stage, ensuring that the interests of shareholders remain a priority. It is expected that the results of this key review will be made public in the third quarter of 2024, after which a decisive vote on its continuation will take place.
This crucial period marks an important moment for BCPT as it overcomes economic obstacles and dislocations in the capital market in an effort to reflect the true value of its assets and the long-term potential of its portfolio.
Balanced Commercial Property Trust, formerly known as BMO Commercial Property Trust, is a large British investment fund specializing in commercial real estate investments. Founded in 2005, the company, formerly known as F&C Commercial Property Trust, is listed on the London Stock Exchange and is included in the FTSE 250 index.
