GIC, Oak Street to buy Store Capital in $14bn deal

GIC, Oak Street to buy Store Capital in $14bn deal

Singapore’s sovereign wealth fund GIC and real estate investment firm Oak Street, a division of net lease investor Blue Owl, will acquire the internally managed net-lease real estate investment trust (REIT) Store Capital Corp.(Store Capital) in a deal valued at about $14 billion.

Under the terms of the definitive merger agreement, Store Capital stockholders will receive $32.25 per share in cash, which represents a premium of 20.4% to Store Capital’s closing stock price as of September 14, 2022 and a premium of 17.8% to the 90-day volume weighted average stock price through that date.

The transaction, which was unanimously approved by the Store Capital Board of Directors, is expected to close in the first quarter of 2023, subject to approval by Store Capital’s stockholders and the satisfaction of certain other customary closing conditions. 

The definitive merger agreement includes a 30-day “go-shop” period that will expire on October 15, 2022, which permits Store Capital and its representatives to actively solicit and consider alternative acquisition proposals.

”Subject to and upon completion of the transaction, Store Capital’s common stock will no longer be listed on the New York Stock Exchange,” said the companies.

“This all-cash transaction delivers a meaningful premium that provides immediate and certain value for our stockholders in a challenging market environment, while positioning the Company, its customers and its partners for continued success,” said Tawn Kelly, Chairman of the Board of Directors of Store Capital. “I would like to extend my thanks to the entire Board and management team for their hard work during this process, and for their unwavering commitment to acting in the best interests of our stockholders.”

“We are pleased to partner with GIC and Oak Street to deliver what we believe is an excellent outcome for our stockholders,” said Mary Fedewa, President and Chief Executive Officer of Store Capital. “This opportunity is an endorsement, by two leading real estate investors with significant access to capital, of the strength of our platform, our experienced leadership team and our disciplined investment approach. We look forward to continuing to grow and support our customers.”

“As one of the largest dedicated U.S. net lease real estate companies in a nearly US$4 trillion-dollar market, Store Capital is a strong addition to GIC’s diverse portfolio of U.S. real estate investments,” said Adam Gallistel, Head of Americas Real Estate, GIC. “We are confident the Company will continue its trajectory of accretive growth by meeting the demand for long-term financing solutions from middle market U.S. companies. We look forward to working closely with Store Capital and our partners at Oak Street to grow this platform over the long term.”

“As a global long-term investor, GIC seeks to invest in best-in-class businesses with strong long-term growth potential,” said Lee Kok Sun, Chief Investment Officer of Real Estate, GIC. “We are thrilled to lead this investment in Store Capital given its impressive cash flow profile, long-weighted average lease term and highly diversified portfolio with strong rent coverage.”

“We are extremely excited to invest together with a like-minded and thoughtful partner in GIC,” said Marc Zahr, President of Oak Street. “We believe the Store Capital platform complements Oak Street’s exposure to the triple-net industry and our focus on sale-leasebacks. The potential scale of this combination and partnership can deliver one of the most diversified, unique and long dated net lease platforms across the globe.”