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Extra Space, Life Storage to Combine in $12.7B Merger
Extra Space Storage Inc. and Life Storage, Inc. said Monday that the two companies had agreed to merge, with Extra Space acquiring Life Storage in a $12.7-billion all-stock transaction, creating the largest storage operation in the U.S. The combined company is expected to have a pro forma equity market capitalization of approximately $36 billion and total enterprise value of approximately $47 billion.
At $145.82 per share, the merger agreement follows Buffalo, NY-based Life Storage’s rejection of an acquisition bid from Public Storage, currently the largest self-storage operator in the U.S. Life Storage’s board determined that Public Storage’s offer of $129 per share undervalued the company, the Wall Street Journal reported.
“We are impressed with the management team’s strategic repositioning of the Life Storage portfolio over the last seven years, creating a highly diversified portfolio of quality storage assets in strong growth markets,” said Joe Margolis, CEO of Salt Lake City-based Extra Space. “The business combination is highly synergistic, creating an even stronger combined company that will drive long-term, outsized operational and external growth opportunities.”
The transaction will increase the size of Extra Space’s portfolio by more than 50% by store count with the addition of Life Storage’s 1,198 properties. In total, the transaction will result in a combined portfolio spanning more than 3,500 locations and more than 264 million square feet and serving more than two million customers.
Extra Space will retain its name and continue to trade on the NYSE under the ticker EXR. Kenneth W. Woolley will remain board chairman and Margolis will remain CEO. The merger is expected to close in the second quarter.
- ◦Sale/Acquisition
