Brookfield Acquires Forest City Realty Trust in $ 11.4 Billion Transaction

With the badistance of active investors, Brookfield Asset Management Inc. entered into an agreement of US $ 11.4 billion, including debt, to purchase Forest City Realty Trust Inc. and take control of its offices, apartments and buildings in major US cities. 19659002] Brookfield's offer of US $ 25.35 per share comes after a major reshuffle of the company's board of directors in Cleveland in March, when nine directors resigned and two activist shareholders were granted bonuses. seats

. served if the company remained an independent company in charge of its best life science buildings in Cambridge, Mbad., as well as commercial buildings and apartments in New York, San Francisco and Washington.

Forest City had spoken to potential buyers earlier this year and finally rejected an offer from an undisclosed buyer that was valued at US $ 25 l & # 39, action plus certain conditions. In announcing its intention to remain an independent entity, Forest City stated that Scopia Capital Management LP and Starboard Value LP would obtain board seats.

Scopia and Starboard will now vote their Forest City shares in favor of the Brookfield acquisition. Together, they hold about 14% of the stock and will not play any role in the merged company, according to Brookfield. Scopia publicly unveiled its stake in Forest City in 2016 and Starboard revealed its stake in 2017.

This is the latest real estate contract to meet after the involvement of activist shareholders.

"We are seeing a significant increase in shareholders generating sales," said Walied Soliman, president of Norton Rose Fulbright Canada and co-chair of the Canadian Law Firm's Special Situations Team. You had a company whose board of directors and management team followed a process and concluded that it was in the company's interest to continue operating independently. Yet, more short-term activists have led a sale. "

If the shareholders approve the deal, the Forest City properties will strengthen Brookfield's position in the competitive US markets of Cambridge, Manhattan and San Francisco.The offer represents a 27% premium over the Forest City closing of US $ 20.03 on June 15, issue day Brookfield announced that Forest City shares were trading at nearly US $ 25 the stock after the announcement Tuesday, 2016.

Forest City has been facing pressure to change the structure since 2016. Forest City shares traded close to US $ 70 per share in 2007, but never fully recovered. restored after the global financial crisis and the Great Recession.

It is not known if one or the other 39, other leaders or board members of Forest City will join B "Since this transaction has just been announced, it is too early to go into details," said a spokesman for Brookfield.

The agreement requires shareholders representing the majority of Forest City shares to approve the transaction. A vote is expected in the fourth quarter of this year.

This is Brookfield's second major real estate transaction this year. A unit of Brookfield Asset Management was successful in March in buying two-thirds of the US mall owner GGP Inc. that she did not yet own in an offer that earned her over 15 billion US dollars.

Zeroing on companies with large real estate properties. For example, Land & Buildings Investment Management LLC took a small stake last year in the Hudson's Bay Company and urged the chain of department stores to sell or develop its first-rate real estate properties. . HBC has since sold its Vancouver flagship property. Last year, FrontFour Capital Group and Sandpiper Group rocked the board of directors of Granite Real Estate Investment Trust.

"The real estate space provides an important opportunity for an agitator or activist to control more factors that can lead to better results. That's why we see more, "said Mr. Soliman. [ad_2]
Source link