Prudential Take a 20% Stake in the Big Yellow

Prudential Insurance Company of America (“Prudential”) has taken an initial 20% stake in The Big Yellow Self Storage business (“The Big Yellow”). The £12m cash injection (including £lm from existing shareholders) gives The Big Yellow the scope to rapidly expand its operations in this fast growing industry. This marks the third corporate acquisition in twelve months by Prudential, following the acquisition of Arlington Securities Plc in October 1998 and Hemingway Properties PLC in August 1999.

Prudential joins TR Property Investment Trust PLC on The Big Yellow share register, through its investment which comprises a mixture of ordinary and preference shares and convertible loan stock.

Self storage is a mature industry in the United States with 27,000 outlets. In the United Kingdom and Europe the sector is still in its infancy with less than 300 centres operational, many of which are poorly located with low quality of service.

The Big Yellow is establishing itself as the quality provider of self storage services with the aim of having ten centres in London and the South East by the end of the year and then expanding into the UK and continental Europe in due course.

Commenting, Richard Mully of Prudential said:
“We have been researching the self-storage market for some time and are convinced that there are enormous growth opportunities for this niche sector throughout the UK and continental Europe. This is a strategic investment in a specialist company with great management, a strong brand and some excellent existing sites, all of which demonstrate its potential to become a dominant market leader in this emerging asset class.”

Nick Vetch, joint Chief Executive of The Big Yellow, commented:
“The addition of Prudential as an investor in The Big Yellow is a strong endorsement of the company and its concept. With the additional capital we have raised, and the support and expertise of TR Property Investment Trust and Prudential, we are well placed to continue our drive to expand the company’s portfolio of assets and build the brand and franchise value”.

Chris Turner, Fund Manager of TR Property Investment Trust, remarked:
“The Big Yellow has a strong, entrepreneurial management team that we have known and supported during the nine years they were at Edge and since they founded The Big Yellow last year. I am delighted to welcome Prudential as a co-shareholder during this next exciting period of growth”.