Strategic Review and Formal Sale Process

Picton Property Income Limited

13 January 2026

 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION

THIS IS AN ANNOUNCEMENT FALLING UNDER RULE 2.4 OF THE CITY CODE ON TAKEOVERS AND MERGERS (THE "CODE") AND DOES NOT CONSTITUTE AN ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CODE. THERE CAN BE NO CERTAINTY THAT ANY FIRM OFFER WILL BE MADE NOR AS TO THE TERMS ON WHICH ANY FIRM OFFER MIGHT BE MADE

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

13 January 2026

PICTON PROPERTY INCOME LIMITED

('Picton' or the 'Company')

Commencement of Strategic Review and Formal Sale Process

The Board of Picton today announces that it is undertaking a strategic review (the "Strategic Review") which will enable the Company to explore all options available to maximise value for shareholders.

Whilst the Company is in a strong financial and operational position, the Board believes it is important to be proactive and has initiated this process, which will take into account the views of shareholders and other key stakeholders.

As part of the Strategic Review, the Board will consider options for a merger with other UK REITs, alongside other forms of consolidation, combination, or selling the entire issued share capital of the Company conducted under a Formal Sale Process in accordance with the City Code on Takeovers and Mergers (the "Code"), or other corporate actions, including but not limited to, selling the Company's portfolio or subsidiaries (or portion thereof) and returning capital to shareholders.

Francis Salway, Chair of Picton, said:

"We have today launched a Strategic Review to consider options to maximise value for our shareholders.

Whilst we have delivered upper quartile property returns since launch in 2005, and our twelve-month share price performance is over 29.8%, Picton shares continue to trade at a material discount to EPRA Net Tangible Assets which doesn't fully reflect the underlying quality and performance of the business." 

Background

The Board recognises that the listed UK real estate sector has, for a prolonged period, been characterised by a majority of its constituents trading at a material discount to EPRA Net Tangible Assets ("NTA"). This persistent valuation disconnect has led to a significant reduction in the number of UK REITs, primarily driven by mergers and take-private transactions.

The Board of Picton strongly believes that the Company's share price has, for a sustained period of time, not adequately reflected the intrinsic value of the Company and its portfolio of assets. Despite the Company's excellent long-term property level track record, strong financial position and recent asset sales to third parties in line with book value, the undisturbed share price of 77.5 pence as at 12 January 2026 represents a 26.9% discount to the 30 September 2025 EPRA Net Disposal Value and a 24.0% discount to the 30 September 2025 NTA.

This environment has also significantly constrained the ability of listed companies in the sector to raise new equity. While growth has been a long-standing objective of the Company, the Board believes that equity markets are likely to remain unsupportive to new issuance in the short to medium term, restricting the Company's ability to scale organically through capital raising. The Company has also explored merger opportunities as an alternative route to growth.

The Company has proactively managed its capital allocation, allocating asset disposal proceeds to maximise shareholder returns. In January 2025, the Company commenced buying back shares and has since spent £24.7 million repurchasing 33.8 million shares at an average discount of 25.4% to the then last reported EPRA NTA.

The Company has successfully attracted new investor interest to widen its shareholder register and has strong shareholder support, however the Board recognises that the landscape of its investor base is evolving. As institutional investors have consolidated, their capital has increasingly been allocated to larger investment vehicles which provide economies of scale and address their own liquidity requirements and exposure limits.

The Board recognises that scale and liquidity are not the sole determinant of performance or rating but is also cognisant of the issues facing the listed UK real estate sector and is mindful that Picton's current size may no longer be optimal as a standalone listed entity.

About Picton

Since its launch in 2005, Picton has provided investors with exposure to the UK property market through a diversified investment approach, investing in the core commercial property sectors. Its unconstrained mandate has allowed the Company, using its expertise in identifying opportunities, to proactively adapt its portfolio to the evolving conditions over time rather than being restricted by sector or geography.

Through asset allocation and proactive income focused asset management, rather than a reliance on higher risk development activity, the Company has delivered consistent property level outperformance whilst successfully navigating numerous macroeconomic events, internalising its management in 2012, and becoming a UK REIT in 2018.

Picton benefits from a highly experienced, fully internalised management team with a long-term track record of delivering outperformance through active asset management and disciplined capital allocation.

The following key attributes underscore the Company's attractive positioning:

·	Total shareholder return (share price and dividends) of 307% since internalisation in 20121;
·	Total shareholder returns significantly in excess of the FTSE EPRA Nareit UK over one, three and five years with the latter representing outperformance by 26.4 percentage points1;
·	Upper quartile returns against the MSCI UK Quarterly Property Index since launch and across three, five, and 10-year periods1;
·	A long-term track record of property outperformance, ranking the Company 7th out of 70 property portfolios in the MSCI UK Quarterly Property Index over the last 20 years1;
·	A UK commercial property portfolio as follows2:
	o  Industrial - £468 million (81% multi-let; 19% distribution)
	o  Offices - £142 million (44% regional cities; 38% South East; 18% Central London)
	o  Retail and Leisure - £85 million (65% retail warehousing);
·	Significant income growth potential through unlocking reversion and improvement in occupancy;
·	£209 million of debt wholly fixed at a weighted average interest rate of 3.7% for 6.2 years, with a loan to value ratio of 22%2; and
·	A dedicated and fully aligned team of 12 focused solely on the undertakings of the listed Company and its property portfolio1.

This has allowed the Company to return £334 million¹ to shareholders through dividends since launch, although as a result of its non-dilutive equity issuance strategy, the Company has not been able to grow through issuing equity since June 2019.

¹ All numbers as at close of business on 12 January 2026

² All numbers as at 30 September 2025

Strategic Review and Formal Sale Process

The Board, with its advisers, has been carefully considering for some time, its strategic options to maximise value for its shareholders, and has determined that it would be in the best interests of shareholders as a whole that it formalise this into a Strategic Review.

As part of this, the Board will consider options for a merger with other UK REITs, alongside other forms of consolidation, combination, or selling the entire issued share capital of the Company conducted under a Formal Sale Process in accordance with the City Code on Takeovers and Mergers, or other corporate actions, including but not limited to, selling the Company's portfolio or subsidiaries (or portion thereof) and returning capital to shareholders. The Takeover Panel has agreed that any discussions with third parties may be conducted within the context of a Formal Sale Process under the Code, which will enable conversations with parties interested in making a proposal to take place on a confidential basis.

The Company intends to conduct a targeted process, focused on those parties that understand and value the full potential of the Company. The Board has appointed Stifel Nicolaus Europe Limited ("Stifel") as its financial adviser with regard to the Formal Sale Process and as independent financial adviser for the purposes of Rule 3 of the Code.

Parties interested in submitting any expression of interest in relation to the Formal Sale Process should contact Stifel through the contact details given below. It is currently expected that any party interested in submitting any form of proposal will, at the appropriate time, enter into a non-disclosure and standstill agreement on terms satisfactory to the Board and on the same terms, in all material respects, as other interested parties before being permitted to participate in the process.

The Company then intends to provide such interested parties with certain information on its business, following which interested parties shall be invited to submit their proposals to Stifel. The Company will update the market as appropriate in due course regarding timings for the Formal Sale Process.

The Takeover Panel has granted a dispensation from the requirements of Rules 2.4 (a) and (b) and 2.6(a) of the Code such that any interested party participating in the Formal Sale Process will not be required to be publicly identified (subject to note 3 to Rule 2.2 of the Code) and will not be subject to the 28 day deadline referred to in Rule 2.6(a), for so long as they are participating in the Formal Sale Process.

The Picton Board reserves the right to alter any aspect of the process as outlined above or to terminate the process at any time and, in such cases, will make an announcement as appropriate. The Picton Board also reserves the right to reject any approach or terminate discussions with any interested party at any time.

The Company is not in active discussions with, nor considered to be in receipt of an approach from, any potential offeror relating to an acquisition of the issued and to be issued share capital of the Company as at the date of this announcement.

Shareholders are advised that this announcement does not represent a firm intention by any party to make an offer under Rule 2.7 of the Code and there can be no certainty that any offers will be made as a result of the Formal Sale Process, that any sale or other transaction will be concluded, nor as to the terms on which any offer or other transaction may be made.

As a consequence of this announcement, an 'Offer Period' has now commenced in respect of the Company in accordance with the Code, and the attention of shareholders is drawn to the disclosure requirements of Rule 8 of the Takeover Code, which are summarised below in "Disclosure requirements of the Code".

The share buyback programme announced on 11 September 2025 will be suspended until further notice as a result of the Strategic Review and Formal Sale Process.

The person responsible for arranging release of this announcement on behalf of Picton is Kathy Thompson, Company Secretary.

For further information: Picton Kathy Thompson, Company Secretary 020 7011 9988 Stifel (Financial Adviser to Picton) Mark Young                                                                                             Jonathan Wilkes-Green Andrew Yeo Jason Grossman 020 7710 7600 Tavistock  James Verstringhe 020 7920 3150 About Picton Established in 2005, Picton is listed on the main market of the London Stock Exchange and is a constituent of a number of EPRA indices including the FTSE EPRA Nareit Global Index. Picton owns and actively manages a £695 million UK commercial property portfolio, invested across 46 assets and with around 300 occupiers (as at 30 September 2025). Through an occupier focused, opportunity led approach, Picton aims to be the consistently best performing diversified UK REIT and has delivered upper quartile outperformance and a consistently higher income return than the MSCI UK Quarterly Property Index since launch.  With a portfolio strategically positioned to capture income and capital growth, currently weighted towards the industrial sector, Picton's agile business model provides flexibility to adapt to evolving market trends over the long-term. Picton has a responsible approach to business and is committed to being net zero carbon by 2040. LEI: 213800RYE59K9CKR4497

Inside Information

This announcement contains inside information as stipulated under the Market Abuse Regulation (EU no. 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018 (as amended)). Upon the publication of this announcement via regulatory information service this inside information is now considered to be in the public domain.

Notices related to financial adviser

Stifel Nicolaus Europe Limited, which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively for Picton and for no one else in connection with the subject matter of this announcement and will not be responsible to anyone other than Picton for providing the protections afforded to its clients or for providing advice in connection with the subject matter of this announcement.

Disclosure requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4). Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at  www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on [phone] if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Rule 2.9 disclosure

In accordance with Rule 2.9 of the Code, Picton confirms that as at the close of business on 12 January 2026 its issued share capital consisted of 513,827,021 ordinary shares of no par value (there are no shares held in treasury). The International Securities Identification Number for Picton ordinary shares is GB00B0LCW208.

Rule 26.1 disclosure

In accordance with Rule 26.1 of the Code, a copy of this announcement will be available (subject to certain restrictions relating to persons resident in restricted jurisdictions) at www.picton.co.uk by no later than 12 noon (London time) on the business day following the date of this announcement. Neither the content of any website referred to in this announcement nor the contents of any website accessible from hyperlinks is incorporated into or forms part of this announcement.

Additional Information

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities, or the solicitation of any vote or approval in any jurisdiction, pursuant to this announcement or otherwise. Any offer, if made, will be made solely by certain offer documentation which will contain the full terms and conditions of any offer, including details of how it may be accepted. The distribution of this announcement in jurisdictions other than the United Kingdom and the availability of any offer to shareholders of Picton who are not resident in the United Kingdom may be affected by the laws of relevant jurisdictions. Therefore any persons who are subject to the laws of any jurisdiction other than the United Kingdom or shareholders of Picton who are not resident in the United Kingdom will need to inform themselves about, and observe any applicable requirements.

Nothing in this announcement is or should be relied on as a promise or representation as to the future. This announcement includes certain statements, estimates and projections provided by the Company in relation to the Company's anticipated future performance. Such statements, estimates and projections are based on various assumptions made by the Company concerning anticipated results which may or may not prove to be correct. No representations or warranties are made by any person as to the accuracy of such statements, estimates or projections.

 

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