The 2002 holiday season undoubtedly played a part in the change for the offering schedule. The offering was extended as the season swung into its final weeks.
About 1.15 million shares of Transcontinental Realty Investors Inc.'s common stock or 14.3% of the outstanding shares were tendered before the deadline changed again. For Income Opportunity Realty Investors Inc. about 274,346 shares or 18.7% had been tendered before the change. At the initial Dec. 13 call, 990,304 shares of Transcontinental were tendered and 252,174 shares of Income Opportunity.
The $61-million merger has been in the works since the fall. It The plan was to close in the fourth quarter. The merger is a settlement for lingering lawsuits from real estate deals of Gene E. Phillips of Dallas. He is the representative to the Gene E. Phillips Children's Trust, sole owner of Basic Capital Management which controls the Dallas-based trio of companies. Phillips is regarded as a Dallas kingpin in the real estate world and is said to be the metroplex's largest landowner.
When the merger closes, Income Opportunity Realty Investors will lose its REIT status. The merger is being leveraged by an offer of $17.50 per share for Transcontinental Realty stock at $17.50 per share and $19 per share for Income Opportunity. For Transcontinental, that represents a 44.6% premium over the average closing price for 30 days of trading and 28.7% over premium for Income Opportunity. Earlier this year, it was projected that American Realty would spend $50 million to acquire the Transcontinental stock and $11 million for the REIT's outstanding balance.
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