Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.
Could you comment if the ABP company split represents good value. It is a little hard to work if buying shares in the new company at $1.41 is value and then what the existing share price price will be after the split. Thanks Shane
Hi Shane,
The $1.41 price discussed this week was for shares in the shortfall that should arise from the accelerated component of a 1 for 5.6 entitlement offer to raise a minimum of $225 million, and this represented a discount to the NTA of the Storage King (ASK) side of 10.1%, which was reasonably attractive in our view given that National Storage (NSR) trades inline with their NTA – it was actually trading at a premium until ABP announced the de-stapling of their security, and separate listing of their self storage operation. You’re right, there are a few moving parts for ABP shareholders, however, when thinking about ASK separately, it looks reasonable, albeit, NSR is a better business, but is priced accordingly.
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