Empiric Student Property has agreed to an acquisition offer from The Unite Group, valued at a cash and share capital value of £723m.

The deal, which comprises 32 pence in cash and 0.085 new Unite shares per Empiric share, represents a premium of approximately 10% on Empiric’s closing share price on its last undisturbed trading date.

Unite said the acquisition of the FTSE 250-listed student property group would provide it with "greater scale and enhanced growth opportunities aligned to the UK’s strongest universities".

The deal is set to create a combined £10.5bn portfolio, with 75,000 beds across UK universities, of which 92% are located in Russell Group cities.

It is also set to create a platform for expansion in the “attractive returner segment”, which represents 11% of the enlarged’ group’s portfolio value, with scope to increase to between 15% and 20% over time through conversions and future acquisitions.

Furthermore, in terms of cost synergies, the FTSE 100-listed company will unlock £13.7m in savings.

Chair at Empiric, Mark Pain, said that the deal comes after the firm’s board and management of Empiric has "implemented a successful strategy, aligning the company’s portfolio to the best locations in the UK’s strong cities".

He added: "Unite has identified Empiric's differentiated proposition through its Hello Student brand, as well as its focus on returner and post graduate students, as clear strategic pillars through which to grow its business.

"The board of Empiric believes the firm and recommended offer from Unite is highly compelling for Empiric's shareholders as it will deliver material accretion to earnings and dividends per share, deliver synergy benefits and provide superior access to capital to drive growth, whilst enabling shareholders to remain invested in a portfolio of highly attractive UK student accommodation assets."

Chair at Unite, Richard Huntingford, concluded: "Acquiring Empiric's high-quality and complementary portfolio accelerates our growth into the attractive returner student segment, enabling us to better serve students throughout their academic journey.

"Unite is uniquely positioned to unlock significant synergies and accelerate earnings growth for both sets of shareholders. Alongside university partnerships and our significant development pipeline, the acquisition provides a new growth driver to deliver enhanced scale and long-term value for shareholders."

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