The PRS REIT LON:PRSR has agreed non-binding heads of terms to sell its operating subsidiary, which holds its entire portfolio of private rented homes, to a vehicle backed by Waypoint Asset Management in a cash deal worth about £646mn.
The proposed transaction would see PRS Holdco, the trust’s operating arm, acquired by a vehicle wholly owned by a fund advised by London-based Waypoint. The equity is expected to come from a co-mingled discretionary fund managed by Waypoint, whose investors include leading UK local government pension schemes.
Gross cash consideration is expected to reach £646.2m, with net proceeds to the REIT of around £633.2m after transaction expenses and tax. Shareholders will also be eligible for a dividend of up to 1.1p per share for the first quarter of FY26, payable in November 2025, without reducing the purchase price.
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The deal is contingent on completion of due diligence by Waypoint, the negotiation of a formal sale and purchase agreement, and approval by PRS REIT shareholders via a special resolution at a general meeting. The board said it is working towards closing the sale by 30 November 2025.
Voluntary liquidation of PRS REIT
Subject to completion, PRS REIT’s board intends to seek shareholder approval for a voluntary liquidation of the company, with a view to distributing net assets to shareholders “as soon as reasonably practicable”. Details of the distribution will follow once the transaction is finalised.
The announcement comes after the company launched a strategic review and formal sale process in July, following consultation with investors. Although PRS REIT engaged with several interested parties, the board said it had not received any superior offers. “Accordingly, the board believes that the proposed sale provides the greatest certainty and cash return to shareholders of any of the proposals received,” the company said.
The sale process remains open. The Takeover Panel has granted PRS REIT a dispensation from certain requirements of the Takeover Code, allowing prospective bidders to remain unnamed and exempting them from the 28-day “put up or shut up” deadline while they remain engaged. The company stressed that there can be no certainty that any rival offer will be made.
Break fee agreed with Waypoint
Under the agreed heads of terms, PRS REIT has committed not to solicit third-party bids for PRS Holdco while negotiations with Waypoint continue. However, the company is not barred from engaging with unsolicited offers. If a competing binding offer or investment materialises and succeeds, PRS REIT will pay Waypoint a £5.7m break fee, equivalent to 1 per cent of its market capitalisation at the time the formal sale process was launched.
Waypoint, founded in London, oversees more than £3bn in assets across equity and debt strategies, managing capital for institutional investors, pension schemes, family offices, and high-net-worth individuals. The firm runs five real estate equity funds and a lending platform. The capital for this deal will come from a discretionary fund, with local authority pension schemes providing the bulk of commitments.
If completed, the sale would mark a significant step in the consolidation of the UK’s build-to-rent sector, while providing PRS REIT shareholders with a cash exit from the listed vehicle.
