Picton Property Income (PCTN) has said it is still assessing the joint bid from LondonMetric (LMP) and Schroder Real Estate (SREI) after delivering “solid” results for the year to 31 March.

“The company is engaging with all stakeholders and due diligence is ongoing,” the company said in relation to the all-share offer it received a month ago having begun a strategic review in January to remedy its lack of scale and persistent share price discount.

Since then the initial £403m value of the all-paper bid, which was encouraged by TR Property (TRY), has dipped as LMP shares have slipped from 187.7p to 182.7p and SREI from 48.3p to 47.75p.

Chief executive Michael Morris said: “We have delivered solid operational performance”, with net assets up 2% and estimated rental value 4.8% higher to produce a 5.9% total property return ahead of the 5.4% rise in the MSCI UK Quarterly Property index. This is the 13^th consecutive year the company has beaten its benchmark.

Shareholders saw a 12.6% total return including 3.8p per share of dividends, which were up 2.7% from 3.7p in the previous year.

The returns were helped by £17.3m of share buybacks at an average 77p per share, 25% below net asset value of 102p at the end of the financial year.

Our view

James Carthew, head of investment companies research at QuotedData, said: “Picton’s results illustrate why I am sorry to see it be carved up. Not many investments can lay claim to a record of beating their benchmark every year for 13 years. The knowledgeable professional property investors taking on its assets can see the medium-to-long term value in the portfolio, why was it languishing on a wide discount?”

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