Global Net Lease Inc. (GNL) has announced its plan to acquire Necessity Retail REIT Inc. (Necessity) in a stock-for-stock transaction valued at approximately $950 million. Shareholders of Necessity will receive 0.670 shares of GNL for each share of Necessity held, resulting in a total value of $7.08 per share. The newly formed company, GNL, will be led by co-CEOs James Nelson and Michael Weil, with Nelson retiring in April 2024. Necessity Retail REIT, established in 2013, operates 1,039 establishments primarily occupied by single tenants.
Last week, it was announced that Global Net Lease Inc. (GNL.N) plans to obtain Necessity Retail REIT Inc. (RTL.O) in an exchange of stocks only, resulting in an estimated value of approximately $950 million for the merged organization. In a joint statement, Necessity Retail REIT and Global Net Lease (GNL) announced that shareholders of Necessity Retail REIT would receive 0.670 shares of GNL for each share of Necessity held, which would result in a total value of $7.08 per share.
Earlier this month, the closing price of GNL's stocks was $10.56. GNL, the newly formed company, will have two co-chief executive officers, James Nelson and Michael Weil, who were previously CEOs of their respective companies. After the merger is finalized, GNL will possess and oversee more than 1,350 real estate assets, the combined worth of which is estimated to be around $9.6 billion.
According to the statement, Weil is going to take over as the only CEO following Nelson's retirement in April 2024. Last month, ISS and Glass Lewis, who provide proxy advice, suggested that shareholders of both REITs refrain from backing certain incumbent directors in the midst of a dispute with hedge fund Blackwells Capital.
GNL is a diversified REIT with a focus on net-lease investments. It was established in 2011 and is headquartered in New York. Its current market capitalization is valued at $1.1 billion. The company possesses a collection of 311 properties that span over 39.3 million square feet and are located across 11 nations. Approximately 99.9 percent of its characteristics possess a weighted average remaining lease duration of 8.3 years. The incorporation of contractual rent hikes is observed in almost 95 percent of its lease agreements.
A significant majority, namely 61 percent, of GNL’s properties are situated in the United States, with an additional 20 percent being located in the United Kingdom. The rest is distributed throughout Europe. More than half of its assets consist of industrial and distribution space, while office holdings make up 42 percent and retail makes up just 4 percent.
Necessity Retail REIT, which is headquartered in New York, was established in 2013 and currently boasts a market capitalization of $629.36 million. Necessity Retail is the proprietor of 1,039 establishments dispersed throughout the 48 states, all of which are under their operation. Approximately 90 percent of its assets consist of properties occupied by a single tenant, while the remaining 1 percent comprise open-air shopping centres that accommodate multiple tenants.
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