Global Net Lease Inc. (NYSE: GNL), a publicly traded net lease REIT externally managed by AR Global (the successor company to American Realty Capital), announced that its board of directors has approved a reverse stock split of the company’s common stock and outstanding units of its operating partnership at a ratio of 1-for-3.
The reverse stock split is expected to take effect at approximately 5:00 p.m. EST on February 28, 2017.
As a result of the reverse stock split, every three issued and outstanding shares of common stock will be converted into one share of common stock and every three operating partnership units will be converted into one operating partnership unit. In addition, at the market open on March 1, 2017, the common stock is expected to be assigned a new CUSIP number.
Following the reverse stock split, the number of outstanding shares of GNL’s common stock will be reduced from approximately 199.0 million to approximately 66.3 million. The split will not affect the timing of the payment of GNL’s previously announced March dividend, which will continue to be paid on March 15, 2017 to stockholders of record at the close of business on March 8, 2017. Stockholders of record will receive the same March dividend payment but adjusted to reflect the reverse stock split equal to $0.1775 per share.
No fractional shares or operating partnership units will be issued in connection with the reverse stock split. Instead, cash will be paid in lieu of any fractional share that would have otherwise resulted from the reverse stock split. No payments will be made in respect of any fractional operating partnership units.
The reverse share split will apply to all of GNL’s outstanding shares of common stock and therefore will not affect any stockholder’s relative ownership percentage. Stockholders are not required to take any action to effectuate the exchange of their stock.
Global Net Lease began as a non-traded REIT known as American Realty Capital Global Daily Net Asset Value Trust in 2011 before changing its name to American Realty Capital Global Trust the following year. The REIT raised approximately $1.8 billion from individual investors between April 2012 and June 2014, selling shares of common stock for $10 per share. On June 2, 2015 the company changes its name to Global Net Lease upon listing its shares on the New York Stock Exchange, closing at $9.35 per share.
At the end of last year, the REIT completed a merger with American Realty Capital Global Trust II, forming a company with a pro forma enterprise value of approximately $3.3 billion and a combined portfolio of 345 properties in seven countries.
Global Net Lease shares closed at $8.08 on Friday.