Equity One Gets 32% of Dim

When the locally based shopping center owner presented its bid for Dim Vastgoed on Sept. 29, it already held, directly or indirectly, a 9.1% interest in the company. By Nov. 16, it had raised its stake to 26.8%, and, during a two-week post-acceptance period, shareholders turned over just 4.4% in additional Dim Vastgoed stock.

Between Sept. 29 and Oct. 13, when it made the price of its offer public, Equity One had held "limited discussions with Dim management," Arthur Gallagher, Equity One's general counsel, told GSR. The discussions "went nowhere," he said, adding that if those conditions remained, his company would make an unsolicited offer. It later did so.

When presented, the offer of $20.50 a share represented a 14.5% premium over the Dutch firm's price that day of $17.90 a share (USD) on the Euronext Amsterdam exchange and a 23.5% premium over the average closing price for the previous 12 months. However, following Equity One's offer, shares of Dim Vastgoed spiked to $20.95, and F. van Lanshot, an analyst of Netherlands-based Bankiers, deemed Equity One's bid "below intrinsic value."

At a meeting of Dim Vastgoed shareholders in Rotterdam on Nov. 5, the company's management characterized the offer as, "in fact, a liquidation of Dim Vastgoed at the expense of current shareholders." It asserted that shareholders would do better by as much as $11.50 a share, in "an offering process initiated and controlled by Dim Vastgoed" and urged shareholders to reject the Equity One offer.

On Nov. 16, Equity One declared its offer of $20.50 a share "unconditional," and announced a two-week deadline for shareholders to tender shares to Equity One at that price. Sipzner told GSR the two-week post-acceptance period was a "courtesy," and said, "We're happy with what we've got. After we see what we have on Nov. 30, we'll reevaluate where we are. This may play out over some time." GSR was unable to reach Sipzner following the company's announcement of its accumulated 31.5% share.

Dim Vastgoed owns 17 shopping centers in Florida, Georgia, Alabama and the Carolinas. Equity One owns 192 properties aggregating 19.6 million sf, overwhelmingly dominated by grocery-anchored shopping centers. This August, it made a bid to buy Port Washington, NY-based Cedar Shopping Centers and later withdrew the offer.