American Landmark / Electra America Proposes Market Expansion
The US multifamily real estate company seeks to acquire a Canadian REIT.
VANCOUVER, BC – US multifamily real estate company, American Landmark / Electra America (ALEA) has submitted a proposal to acquire a Canadian REIT, seeking to expand into the global market.
ALEA’s written proposal to the Board of Pure Multi-Family REIT LP would acquire all outstanding Class A Units of Pure, for an all-cash price of US$7.6 per unit, representing a 15% premium to the units’ last closing 20-day volume-weighted-average trading price on the Toronto Stock Exchange.
ALEA has tapped Raymond James and Goldman Sachs to advise on the deal, looking to quickly complete the proposed transaction once due diligence is completed. Owner and operator of many US multifamily properties, ALEA has offered to negotiate terms with Pure’s Board. In addition, ALEA has also offered a $40 million all-cash deposit in escrow to secure reverse break fee requirements.
This is the second proposal from ALEA. The company’s first submission on June 18, 2019 expired without a definitive response from Pure’s Board, upon offering US$7.54 per unit.
Details of the premiums represented by the proposed purchase are found below:
- 15% to the closing traded price of the units on the TSX on June 25, 2019
- 17% to the REIT’s most recent appraisal-based IFRS valuation of US$6.53 per unit
- 6% to average consensus research analyst Net Asset Value of US$7.19 per unit
- 4% to average consensus research analyst Target Price of US$7.29 per unit
ALEA has acquired, operated and sold more than 150 multifamily communities in the US, with its affiliates, representing more than 100,000 apartment units valuing more than $9 billion. Currently owning 28,000 units at more than $4 billion, the company works in both private and public sectors of the market.