Singapore’s GIC and Oak Street to Acquire STORE Capital for $14B

By Nick Hedley

Singaporean sovereign wealth fund GIC and Oak Street, a division of net-lease investor Blue Owl, will acquire NYSE-listed STORE Capital for $14 billion in an all-cash deal, the companies said in a statement.

STORE Capital, a net-lease real estate investment trust (REIT) that invests in single-tenant operational property, saw its share price tumble at the start of the COVID-19 pandemic. Its stock has recouped some of those losses but remains below pre-pandemic levels. The REIT was trading above $40 a share in late 2019.

As per the terms of the transaction, investors in STORE Capital will receive $32.25 per share in cash – a premium of 20.4% to STORE Capital’s closing stock price as of September 14.

The transaction will provide “immediate and certain value for our stockholders in a challenging market environment,” said Tawn Kelley, chairman of STORE Capital.

Mary Fedewa, president and CEO of STORE Capital, said: “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.”

STORE Capital is one of the largest dedicated U.S. net-lease real estate companies, in a nearly $4 trillion market, according to the joint statement.

Lee Kok Sun, chief investment officer of real estate at GIC, said STORE Capital had an “impressive cash flow profile, long-weighted average lease term and highly diversified portfolio with strong rent coverage.”

The transaction has been approved by the STORE Capital board and is expected to close in the first quarter of 2023, subject to approval by the REIT’s stockholders and other conditions.

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