Shurgard Self Storage Limited · EURONEXT:SHUR
Shurgard Self Storage — Merger or Acquisition (September 2005)
14 slides from Shurgard Self Storage's merger presentation, September 2005
Slide 1: Unique Portfolio Delivering Superior Value
Unique Portfolio Delivering Superior Value September 2005
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains statements that are not based on historical fact and are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements in this presentation concerning the beliefs, expectations, intentions, fu
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures Shurgard uses FFO in addition to net earnings to report its operating results. Shurgard uses the definition of FFO adopted by the National Association of Real Estate Investment Trusts. Accordingly, FFO is defined as net earnings (computed in accordance with GAAP), excludi
Slide 4: Why Our Board Rejected PSA’s Proposal
Why Our Board Rejected PSA’s Proposal u Our portfolio is unique, cannot be replicated and is not being properly valued u Our growth prospects in both Europe and the U.S. are superior to PSA’s u Our shareholders would be worse off due to: l NAV dilution l Reduced FFO growth l Reduced dividend l Tax b
Slide 5: Unique Portfolio that Cannot be Replicated
Unique Portfolio that Cannot be Replicated ... u Large and growing international portfolio l 623 properties (a) in 44 major markets – 31 in the U.S. and 13 in Europe l High embedded growth potential Ø Shurgard’s New Stores represent 17% of total investment but generate only 3% of NOI (a) u In our vi
Slide 6: PSA’s Proposal Offers Far Less than the Value of Our Assets
PSA’s Proposal Offers Far Less than the Value of Our Assets u Platform / franchise value u Development $117.2 million assets and $122.6 million adjustment to reflect pipeline adjustment to reflect additional other u Tenant 80% joint venture assets (d) reinsurance partners’ share of income consolidat
Slide 7: PSA Proposal Significantly Undervalues Our US Portfolio
PSA Proposal Significantly Undervalues Our US Portfolio ... u After backing out an assumed value for the European portfolio based on Green Street research (a), the implied transaction multiple on our US portfolio is well below PSA’s multiple u We believe that our U.S. portfolio has higher growth pro
Slide 8: PSA’s Proposal Dilutes our Shareholders’ Growth Prospects
PSA’s Proposal Dilutes our Shareholders’ Growth Prospects u As a result of our prudent investment strategies and superior property management, we and Wall Street analysts believe Shurgard’s NOI and FFO growth will outpace PSA’s 18.4% 11.3% 8.2% 7.2% PSA Shurgard PSA Shurgard 2006-2007 2006-2007 FFO
Slide 9: We Will Also Realize Significant FFO Growth Through Expense Reductions
We Will Also Realize Significant FFO Growth Through Expense Reductions Targeted Annual Area of Expense Reduction Savings Comments u Targeted total G&A of 4% of total revenue – still higher than our 5- year average of 3.3% from 1998 to 2002 G&A Expense $9.5 u $7.5 mm SarbOx expense reduction – leaves
Slide 10: PSA’s Proposal Would Cut Shurgard’s Dividend
PSA’s Proposal Would Cut Shurgard’s Dividend u PSA’s proposal would result in a significant dividend reduction for Shurgard shareholders Pro Forma Annual Percent Current Dividend Dividend to Shurgard Dividend Dividend SHU PSA Shareholders (a) Loss Reduction $2.24 $2.00 $1.60 ($0.64) (28.6%) u Shurga
Slide 11: Taxable Transaction Reduces Value for Shurgard Shareholders
Taxable Transaction Reduces Value for Shurgard Shareholders u Value to Shurgard shareholders is less than 0.8 PSA shares l Our individual investors would pay taxes l Many institutional investors would have to pass the tax burden to their investors l Many shareholders may need to sell PSA stock in or
Slide 12: Proposed Transaction has Significant Execution Risk
Proposed Transaction has Significant Execution Risk u Over the past 10 years, Shurgard’s management team has acquired a deep development and operating knowledge base in each of its 13 European submarkets l PSA has no development or operating experience in European markets u Merging different operati
Slide 13: Our Board Is Committed to Serving the Best Interests of Our Shareholders
Our Board Is Committed to Serving the Best Interests of Our Shareholders u The Board of Directors fully understands its fiduciary duties and is committed to acting in the best interests of all shareholders l The Board gave serious and careful consideration to PSA’s proposal u The Board of Directors
Slide 14: The Proposal Remains Good for PSA, Bad for Shurgard
The Proposal Remains Good for PSA, Bad for Shurgard u We have a unique portfolio that cannot be replicated u Our portfolio is not being properly valued u PSA’s proposal dilutes our shareholders’ growth prospects u PSA’s proposal would cut Shurgard’s dividend u Taxable transaction unfairly penalizes
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