Big Yellow keeping ‘all options’ under review amid activist investor pressure
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Self-storage firm Big Yellow Group has confirmed it is keeping “all options” under review as it comes under pressure from an activist investor to put itself up for sale.
The London-listed group said it met with the shareholder who is “encouraging Big Yellow to explore a sale”.
US activist investor Ancora Holdings – which owns a 4% stake in Big Yellow – earlier this week urged the company to launch a strategic review, saying it believed a sale would be the best outcome for shareholders.
US activist investor Ancora Holdings – which owns a 4% stake in Big Yellow – earlier this week urged the company to launch a strategic review, saying it believed a sale would be the best outcome for shareholders.
Shares in Big Yellow have slumped to multi-year lows as it has been hit by a weak housing market and uncertain wider economic backdrop.
The stock has rallied in recent days on Ancora’s push for a sale, with shares up another 4% on Thursday.
Big Yellow said: “The board and management team continue to focus on executing the company’s clear and proven strategy.
“The board is also cognisant of its fiduciary duties and continually evaluates all options for maximising shareholder value.”
Big Yellow ended talks with private equity giant Blackstone in December as the price was too low.
Big Yellow said on Thursday it held discussions with a “small number of parties” in October on a range of options, including a possible sale, before holding talks with one suitor, which came to an end as the value proposed was “not at a level that reflected the full potential of the company”.
On Tuesday, Ancora said it plans to “engage constructively with Big Yellow to deliver full value for shareholders”.
It wants Big Yellow’s board to look at “soliciting interest from the deep pool of likely strategic and financial acquirers globally”.
It added: “Ancora believes that a sale of Big Yellow represents the best risk-adjusted outcome for shareholders.
“In addition, with shares at a five-year low, Ancora believes Big Yellow can take pragmatic value-enhancing actions such as divesting non-core assets, rebranding or selling Armadillo and monetising the property development pipeline.”
