Summary
Extra Space Storage Inc. (EXR) filed an 8-K on November 9, 2012, reporting on a significant equity offering that closed on November 9, 2012. The company successfully issued and sold 5,200,000 shares of common stock, with an additional 780,000 shares sold under the underwriter's option, generating approximately $202.9 million in net proceeds. This capital infusion is primarily earmarked for funding previously announced acquisitions of 28 properties for an aggregate purchase price of roughly $190.2 million, as well as for debt reduction and general corporate purposes. Investors should note that the pending acquisitions are contingent upon satisfactory due diligence, other closing conditions, and, for one acquisition under letter of intent, the negotiation of a definitive agreement. The company aims to complete these acquisitions by December 31, 2012, but acknowledges that there can be no assurance these conditions will be met or that the transactions will close as planned. This offering represents a key strategic move for EXR to expand its property portfolio.
Key Highlights
- 1Successful completion of a secondary offering of common stock, closing on November 9, 2012.
- 2Generated net proceeds of approximately $202.9 million from the stock issuance.
- 3Funds will be used to acquire 28 new properties with a total purchase price of approximately $190.2 million.
- 4Remaining proceeds allocated to repaying secured line of credit debt and for general corporate/working capital needs.
- 5The acquisitions are subject to customary closing conditions and due diligence.
- 6The company targets closing all 28 acquisitions by December 31, 2012.
- 7Citigroup Global Markets Inc. served as the underwriter for the offering.