Bridgepoint shares jump after $1.4 billion swoop on US property firm

LONDON, June 29 (Reuters) - British private equity group Bridgepoint has agreed to buy U.S.-based Kayne Anderson's real estate business in a deal valued at about $1.4 billion, it said on Monday, driving its shares up more than 10%.

Bridgepoint said the acquisition, aimed at diversifying its income sources and accelerating international expansion, would add $22 billion of property assets to form a combined group with $117 billion of assets spanning private equity, credit, infrastructure and property.

The wider real estate industry has seen a spate of recent deals as smaller property investors bulk up to better compete with larger rivals and weather higher borrowing costs. 

Bridgepoint's shares gained as much as 12% in early trading. They were last up 9.3% at 0810 GMT.

The deal — valued at about $1.39 billion, including debt — comprises $759 million in cash and around 189 million newly issued shares.

Bridgepoint expects the deal to boost its earnings per share by a mid-single-digit percentage in 2027 and by more than 20% in 2028, while deepening its U.S. presence.

"This marks another major step forward in our strategy to strengthen our position as a leading global middle-market private markets platform," said Raoul Hughes, chief executive of Bridgepoint.

Analysts at Jefferies said in a note the deal allowed Bridgepoint to cover all major private markets, and that it had "earned the right" to do more deals after receiving a boost from its 2024 takeover of Energy Capital Partners.

Kayne Anderson Real Estate invests in sectors including medical office, seniors housing, student housing, multifamily housing and light industrial units across the United States.

The Financial Times first reported the two companies were in talks on Saturday.

(Reporting by Iain Withers in London and Amna Mariyam in Bengaluru; Editing by Harikrishnan Nair and Emelia Sithole-Matarise)