Private rented sector firm Sigma agrees £188.4m takeover deal

Private rented sector company Sigma Capital Group announced on Friday that it has reached agreement on the terms of a recommended cash offer by PineBridge Benson Elliot.

The AIM-traded firm said that under the terms of the acquisition, each Sigma shareholder would be entitled to receive 202.1p in cash for each Sigma share held.

It noted that the price represented a premium of about 35.6% to the closing price of 149p on 10 June, and 37.1% to the volume-weighted average price of 147.5p per share for the three months to 10 June.

The price was also a premium of 44.9% to the volume-weighted average price of 139.5p per share for the six months to 10 June.

Sigma Capital said the acquisition valued its entire issued ordinary share capital at around £188.4m on a fully-diluted basis.

It described PineBridge Benson Elliot as a pan-European real estate private equity specialist, with around $3.2bn of managed equity, holding a diversified real estate portfolio, currently comprised of office, retail, hotel and residential assets in the UK, France, Germany, Italy, Spain, Belgium and central Europe.

Benson Elliot was acquired in December 2020 by PineBridge Investments, a private, global asset manager with $133bn in assets under management as of March.

“We are delighted that our independent directors intend to recommend this offer from PineBridge Benson Elliot, having reviewed a number of options from other parties,” said Sigma Capital’s founder and chief executive officer, Graham Barnet.

“We know the team well and believe that our complementary skills, experience and sector knowledge, as well as PineBridge Benson Elliot's capital backing, will make a powerful combination, and enable Sigma to expand its activities significantly.”

Barnet said Sigma was a “pioneer” in the delivery of new, single-family homes in the private rented sector, creating an “unrivalled” property delivery and management platform.

“We believe we have delivered one of the largest number of new family rental homes in the UK.

“We also manage the rental of thousands of homes for our partners.

“The need for high-quality, professionally-managed rental homes remains a critical unmet need in the UK, and we look forward to developing our model further in this exciting next step with PineBridge Benson Elliot.”

Joseph De Leo, managing partner at PineBridge Benson Elliot, said that having spent recent months growing its understanding of Sigma’s strengths and strategic priorities, it believed that the combination of its capital backing, strategic support, deep expertise, and track record could be an “effective catalyst” for achieving Sigma's growth ambitions in the coming years.

“Sigma operates in an important part of the market that has shown remarkable resilience over the past year and, in partnership, we can further build on the successful UK housing platform the Sigma team have established,” De Leo added.

“We are pleased that the independent members of the Sigma board have unanimously recommended our proposal and that the major Sigma shareholders have endorsed the board's decision by adding their strong support.”

At 0944 BST, shares in Sigma Capital Group were up 34.58% at 200.53p.