Public Storage to Acquire National Storage Affiliates in All-Stock $10.5B Deal
Public Storage, a leading owner and operator of self-storage facilities, and National Storage Affiliates Trust (NSA) on Monday announced that Public Storage will acquire National Storage Affiliates in an all-stock transaction valued at an enterprise value of approximately $10.5 billion. NSA’s portfolio includes more than 1,000 properties, 69 million rentable square feet and 550,000 units across 37 states and Puerto Rico. The combined company is expected to have a pro forma equity market capitalization of approximately $57 billion and total enterprise value of approximately $77 billion.
“With the launch of the PS4.0 strategic vision focused on accelerated per share earnings and cash flow growth, this transaction will enable us to strategically and accretively expand our platform with assets that are highly complementary with our portfolio, deepen our significant market presence, and enhance our long-term per share growth profile,” said Tom Boyle, incoming CEO of Public Storage.
Immediately prior to closing, Public Storage and limited partners in NSA’s operating partnership will form a joint venture consisting of 313 properties on NSA’s operating platform comprising 19.6 million rentable square feet across 28 states and Puerto Rico with an estimated value of approximately $3.3 billion. OP unitholders are expected to own approximately 80% of the JV at inception, with PSA holding the remaining interest.
Public Storage will repay NSA’s existing bank debt and senior unsecured notes while assuming its existing mortgage debt and Series A, B and A-1 preferred shares and units. Public Storage has arranged committed financing of $4.0 billion, to be provided by Goldman Sachs and Wells Fargo, comprised of a $2-billion-corporate bridge loan and a $2-billion JV off-balance sheet bridge loan which will become permanent secured mortgage financing.
Goldman Sachs, Wells Fargo, and Eastdil Secured are serving as financial advisors, Wachtell, Lipton, Rosen & Katz is serving as legal advisor, DLA Piper is serving as real estate financing counsel, and Kekst CNC is serving as strategic communications advisor to Public Storage.
Morgan Stanley is acting as exclusive financial advisor, Clifford Chance US LLP is serving as legal advisor, and Joele Frank, Wilkinson Brimmer Katcher is serving as strategic communications advisor to NSA. The transaction is expected to close in the third quarter.
