Under the proposed deal, Picton shareholders would receive 0.190 new LondonMetric shares and 0.881 SREIT shares for each Picton share held. The offer values Picton at 78.2p per share, a 7% premium to its closing share price on 11 May.

Around 46% of the value would be represented by LondonMetric shares and 54% by SREIT shares, reflecting the intended split of Picton’s underlying portfolio assets between the two buyers.

The offer also represents a 13% premium based on the one-month volume weighted average share prices prior to Picton’s announcement of a formal sale process in January. However, it implies a discount of 5.6% to Picton’s December 2025 portfolio valuation and an EPRA NTA discount of around 9.2%.

The consortium said the structure would allow Picton shareholders to “crystallise a premium” while gaining exposure to UK-listed real estate through stakes in two larger REITs with greater scale and liquidity. It added that the deal would retain Picton’s portfolio in the UK-listed market, while addressing the challenges faced by smaller listed property companies.

LondonMetric also highlighted the opportunity for shareholders to remain invested in an internally managed platform with a strong total return track record.

SREIT pointed to the benefits for Picton shareholders of exposure to higher-yielding assets and income-led returns. It also said the acquisition would strengthen its balance sheet by reducing its loan-to-value (LTV) ratio to its long-term 25% to 35% target range, and by inheriting lower-cost debt.

The consortium added that the deal was expected to be earnings accretive for both LondonMetric and SREIT, while providing a material uplift in dividend income for Picton shareholders.

Andrew Saunders, equity research analyst at Shore Capital, said: “The Picton portfolio offers a complementary fit for both LondonMetric and SREIT. While valued at £723m at 31 December 2025 (but more likely now around £685m based on the proposed offer), the portfolio is comprised of approximately 67% industrial assets, 21% offices and 12% retail/leisure.

“Quite how the portfolio would be carved up between LondonMetric and SREIT remains to be seen, but  LondonMetric is likely to only want selected industrial and retail/leisure assets (with the pro-forma portfolio weightings remaining similar to that prior to the acquisition), while SREIT is more likely to be interested in all there asset classes, given its existing portfolio.”

Meanwhile, Marcus Phayre-Mudge, fund manager at TR Property Investment Trust (Picton’s largest shareholder with an 11.4% holding), said: “This type of consolidation is not corporate activity for its own sake. It is how good assets escape the small-cap cul-de-sac and move into platforms with deeper capital, stronger liquidity and greater management firepower. Crucially, this deal means the assets avoid disappearing behind the private equity curtain. They remain in the listed market, preserving access to quality real estate for a broad shareholder base.”

He added: “Whilst the headline price may look optically modest against historic asset values, the longer-term significance of the proposed deal is more positive than the initial share price reaction suggests. It may prove to be one of the final chapters in the evolution of the UK micro-REIT landscape, but it is an important one, neatly illustrating the central purpose of consolidation: improved efficiency.”