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Blackstone to acquire Tricon Residential for $3.5 billion



© Reuters.

NEW YORK – In a significant expansion of its real estate portfolio, Blackstone (NYSE:) announced today its acquisition of Tricon Residential for $3.5 billion. The deal will transfer ownership of approximately 38,000 U.S.-based single-family rental homes to Blackstone’s holdings, marking a substantial investment in the residential real estate sector.

The acquisition, orchestrated by Blackstone Real Estate Partners X and Blackstone Real Estate Income Trust, values Tricon Residential at $11.25 per share. Following the announcement, Tricon’s shares experienced a sharp increase, soaring over 27%. In response to the acquisition, Tricon has put a halt to its dividend payments and reinvestment plans.

Blackstone’s strategic move is not just about expanding its current assets but also about fostering growth. The company plans to further develop Tricon’s existing pipeline within the U.S. and carry on with development projects in Canada. The transaction is slated for completion in the second quarter of this year, indicating a swift integration of Tricon’s assets into Blackstone’s expansive real estate portfolio.

InvestingPro Insights

In light of Blackstone’s acquisition of Tricon Residential, a closer look at Tricon’s financial metrics and market performance provides additional context for investors. With a market capitalization of $3.01 billion and a P/E ratio standing at 14.6, Tricon appears to be trading at a lower earnings multiple, which could signal a potentially undervalued stock in the eyes of some investors.

Recent performance data shows significant returns for Tricon, with a one-week price total return of 20.85% and a one-month price total return of 22.41%, indicating a strong short-term uptrend. This aligns with the share price surge following the acquisition news. Moreover, Tricon has managed to maintain dividend payments for 14 consecutive years, although they are currently halted due to the acquisition. This track record may reassure investors about the company’s commitment to shareholder returns.

For those considering a deeper investment analysis, InvestingPro offers additional insights. There are more InvestingPro Tips available on the platform, providing a comprehensive view of the company’s financial health and performance forecasts. These tips can be accessed through an InvestingPro+ subscription, which is now on a special New Year sale with a discount of up to 50%. To enhance your investment strategy, use coupon code SFY24 to get an additional 10% off a 2-year InvestingPro+ subscription, or SFY241 to get an additional 10% off a 1-year InvestingPro+ subscription.

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