Extra Space Storage to acquire Life Storage in an all-stock transaction

Extra Space Storage (EXR) and Life Storage (LSI) announced that the two companies have entered into a definitive merger agreement by which Extra Space will acquire Life Storage in an all-stock transaction. The combined company is expected to have a pro forma equity market capitalization of approximately $36B and total enterprise value of approximately $47B. Under the terms of the agreement, Life Storage shareholders will receive 0.8950 of an Extra Space share for each Life Storage share they own, representing a total consideration of approximately $145.82 per share based on Extra Space’s share price close on March 31. At closing, Extra Space and Life Storage shareholders are expected to own approximately 65% and 35% of the combined company, respectively. The respective boards of directors of both Extra Space and Life Storage have unanimously approved the transaction. The transaction will increase the size of Extra Space’s portfolio by more than 50% by store count with the addition of Life Storage’s 1,198 properties, including 758 wholly-owned, 141 joint venture, and 299 third-party managed stores. In total, the transaction adds over 88M square feet to the portfolio. The combined portfolio represents the largest storage operation in the country with over 3,500 locations, over 264M square feet and serving over two million customers. Extra Space will retain its name and continue to trade on the NYSE under the ticker (EXR). Kenneth Woolley will remain chairman of the board and Joseph Margolis will remain as CEO and director. The Extra Space board will be expanded from 10 to 12 directors and will consist of nine directors from Extra Space’s board and three directors from Life Storage. The transaction is currently expected to close in the second half of 2023, subject to the approval of Extra Space and Life Storage shareholders and satisfaction of other customary closing conditions.