Spring Real Estate Investment Trust, the Hong Kong-listed REIT, has sold an 83-strong portfolio of UK Kwik Fit car servicing centres back to the tyre retailer's parent Tokyo Stock Exchange-listed Itochu Corporation.
In a Hong Kong Stock Exchange filing, Spring said the portfolio has been sold ultimately to Japanese conglomerate Itochu in a transaction that will see the buyer pay £26.386 million in aggregate for the target property owner company's shares and the consideration for the assignment of the target shareholder's loan.
The buyer is a wholly-owned subsidiary of Itochu Corporation and a subsidiary of the lessee, which is Kwik Fit, the leading UK tyre retailer that Itochu bought in 2011.
Spring REIT bought the 500,000-square-foot-plus portfolio, plus one other subsequently sold servicing centre, from Itochu in 2017 in a deal valued at £73.5 million. Spring REIT said it was completing the sale back to Itochu to focus on its core portfolio in China.
The properties are leased to and operated by Kwik Fit across Scotland, England and Wales as car servicing centres and are typically between 4,000 square feet and 15,000 square feet in size. The largest is a 20,922-square-foot facility at 103 New London Road in Chelmsford.
As at 31 December 2024, the total appraised value of the portfolio was £71,154,000.
The properties are held under long-term leases each with a remaining term of approximately 7 years, expiring on 19 March 2032 with the Lessee’s option to renew for a further term of 15 years on substantially the same key terms.
The disposal is considered a “special deal” under Rule 25 of the Takeovers Code, as it is a disposal of Spring REIT’s assets to a unitholder which holds a stake in Spring REIT subsidiaries.
The buyer is Anglo-Dutch Property (UK) Holding Limited whose ultimate beneficial owner is Itochu Corporation.