2012

Merger with London & Stamford Property Plc

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Smith Square Partners acts as financial adviser to Metric Property Investments PLC in relation to its merger with London & Stamford Property Plc

On 9th November 2012, the Boards of London & Stamford Property Plc (“London & Stamford”) and Metric Property Investments PLC (“Metric”) announced a recommended merger pursuant to which London & Stamford will acquire the entire issued and to be issued ordinary share capital of Metric. Under the terms of the merger, the shareholders of Metric will be entitled to receive 0.94 new ordinary shares for each Metric ordinary share, resulting in Metric shareholders owning 25 per cent. and London & Stamford shareholders owning 75 per cent. of the enlarged share capital. On the basis of the closing price of 117 pence on 5 November 2012, the merger values each Metric ordinary share at 110 pence and the entire issued and to be issued share capital of Metric at approximately £209.0 million.

The merger represents a premium of approximately 18 per cent. to the closing price per Metric ordinary share of 93 pence on 5 November 2012 (being the last business day prior to the commencement of the offer period) and 24 per cent. per cent. to per cent. to the six-month average price per Metric ordinary share of 89 pence (being the average closing price for the six month period ended on 5 November 2012).

London & Stamford also announced its intention, following completion of the merger, to undertake a return of capital of £100 million to shareholders of the enlarged company.

Metric is a UK retail focused real estate investment trust. Metric was established to assemble a portfolio of freehold and long leasehold retail properties throughout the UK and Ireland. As at 5 November 2012, Metric had a market capitalisation of £176.7 million and, as at 30 September 2012, had net assets of £200.1 million.

London & Stamford is a UK focused real estate investment trust. London & Stamford invests in residential and commercial property, including office and distribution real estate assets, all of which are located in the UK. As at 5 November 2012, London & Stamford had a market capitalisation of £635.1 million and, as at 30 September 2012, had net assets of £609.8 million.

Following completion of the merger, London & Stamford and Metric intend to merge their operations into a single unified business, under a unified board structure and senior management team. The enlarged group will have gross property assets (including its shares in joint ventures) of £993 million (based on 30 September 2012 property valuations). It is intended that the enlarged company will operate under a new name, LondonMetric Property Plc, will remain listed on the London Stock Exchange and have a new ticker, LMP.L. on the London Stock Exchange.

Raymond Mould, Chairman of London & Stamford, said:

“This transaction merges two terrific companies both with well let property portfolios and reunites a highly experienced management team that has the proven ability to identify and crystallise value through opportunistic transactions. A combination of London & Stamford and Metric has the potential to create significant shareholder value for all parties and brings considerable benefits for both sets of shareholders. I am delighted to have this opportunity to hand over the keys of an excellent real estate portfolio to an experienced and well trusted team, chaired by Patrick Vaughan who has been my business partner and friend for over 40 years, and have no doubt that they will build upon the considerable success that has been achieved to date.”

Andrew Jones, Chief Executive of Metric, said:

“The proposed merger will create a larger REIT with scale, diversity and liquidity and brings together deep real estate knowledge, financial resources and management skills. Organisations across the world are deleveraging and we believe that this will continue to bring attractively priced assets to the market. We are excited by the prospect of being strongly positioned, with London & Stamford, to exploit these opportunities as they arise across the market.”

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