National Storage shares rise on Gaw Capital bid

Gaw Capital was named the suitor of National Storage REIT on Thursday

The market may be betting that the offer from private equity firm Gaw Capital Partners for National Storage REIT values the company at about $1.62bn.

But the question remains whether any other parties are weighing an acquisition of the self storage unit owner.

Private equity giant Blackstone is believed to have looked at the company before, and some observers say should another party emerge, it is likely to be from the US.

While locally Abacus Property is seen as the most obvious rival suitor, market analysts are doubtful that it could outbid offshore bidders.

Interestingly, Abacus and Gaw partnered on an industrial fund in 2016 to target $200m in assets on Australia’s east coast.

However, Abacus has sold out of ventures with Gaw over the past 18 months.

Other Australian companies that have been a target for Gaw in Australia include retirement operator Aveo, which was sold to Brookfield last year. It also looked at the Astro Japan Trust before it was acquired by Blackstone.

Gaw Capital was named the suitor of National Storage REIT on Thursday, confirming DataRoom reports that a suitor was thought to be moving towards a takeover. A price has not been disclosed.

Macquarie analysts say the price could be about $2.21 a share, adding that cost cuts to the company could boost its earnings by about 15 per cent.

National Storage shares closed up 6.3 per cent at $2.19.

Working for National Storage REIT is JPMorgan while Gaw is advised by Goldmans.

The approach is expected to be followed by other takeover attempts in the real estate space amid a low interest rate environment. It makes more sense for suitors to buy a property company rather than individual assets.