Blackstone sells $1.3 billion UK logistics assets, considers Big Yellow bid

LONDON (Reuters) -Blackstone said on Monday it would sell about 1 billion pounds ($1.3 billion) of UK logistics assets to Tritax Big Box in exchange for cash and a 9% stake, and was separately weighing a bid for UK self-storage firm Big Yellow. 

The announcements are part of a wider push in deal activity and investment in Britain and Europe by the Wall Street giant.

The U.S. private equity firm, which has pledged to invest 100 billion pounds in Britain over the next decade, won a bidding war in July against Tritax Big Box to buy logistics specialist Warehouse REIT for nearly 500 million pounds. 

Blackstone has become a major player in logistics in Europe as a boom in internet shopping boosts demand for warehouses.

While it has agreed to sell about 41 of its logistics assets within a larger British portfolio to Tritax, it will become one of its biggest shareholders when it takes a 9% stake. Tritax will also pay Blackstone 632 million pounds in cash. Shares in Tritax were last up 3% following the news.

BLACKSTONE CONSIDERS BID FOR BIG YELLOW SELF-STORAGE FIRM

Separately, Blackstone said it was in the early stages of considering a cash offer for Big Yellow Group - which has a market capitalisation of about 1.9 billion pounds. That sent shares of the London-listed firm higher by as much as 22%.

Big Yellow Group said after Blackstone's statement that it had met with a small number of parties to consider options including a potential sale, but had not received an approach.

The UK real estate sector has seen significant consolidation in recent years as higher borrowing costs have weighed on property values, though some investors are betting on a revival.

Among the deals, British healthcare real estate investor and NHS landlord Assura is being bought by rival Primary Health Properties after a months-long battle with private equity firm KKR.  

($1 = 0.7503 pounds)

(Reporting by DhanushVignesh Babu and Yamini Kalia in Bengaluru, Iain Withers in London; Editing by Sherry Jacob-Phillips and Bernadette Baum)