UPDATE 1-Extra Space Storage to buy out partner from ESS PRISA for $160 mln

Mon Apr 16, 2012 5:06pm EDT

* To acquire Prudential Real Estate Investors' 94.9 pct stake

* To pay $160 mln in cash

* To complete the acquisition in July 2012

April 16 (Reuters) - Extra Space Storage Inc said it has agreed to buy out its partner Prudential Real Estate Investors (PREI) from their joint venture ESS PRISA III LLC for $160 million in cash.

Prudential Real Estate Investors(PREI) owns about 94.9 percent of the joint venture, while Extra Space Storage owns the remaining.

ESS PRISA III LLC, a joint venture between the two companies, owns 36 self-storage properties in 18 states, operated under the Extra Space Storage brand.

The joint venture also has an outstanding loan of $145.0 million, due for repayment in August 2012. Including the loan, the cost of the acquisition is about $298.0 million, Extra Space Storage said in a statement.

Separately, Salt Lake City, Utah-based Extra Space Storage said it was offering 7 million shares of its common stock to fund the acquisition.

Shares of Extra Space Storage closed at $28.89 on Monday on the New York Stock Exchange. They have gained about a third of their value in the last seven months.

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