AEW UK REIT (LSE:AEWU) confirmed it will not proceed with a firm offer for Alternative Income REIT (AIRE), abandoning a possible all-share deal first flagged on 16 July.
The decision follows Glenstone's public refusal to support an AEWU offer, despite backing from AIRE's own board.
Glenstone holds 25.4% of AIRE's issued share capital and has made a rival cash offer for the company at a discount to its net asset value.
AEWU said Glenstone's support was essential to any orderly combination of the two real estate investment trusts, with AEWU as the surviving entity, and that attempts to engage the shareholder on the merits of its proposal did not change its position.
Had it proceeded, the deal would have combined two REITs with aligned property portfolios, offering greater diversification, increased scale, lower operating costs and continuity of AEWU's 8p annual dividend, and would have been earnings accretive for AEWU.
