PALO ALTO, CA-Oriole Partnership improved its definitive offer for Town and Country Trust over the weekend. The joint venture of locally based Essex Property Trust, UBS Wealth Management's North American Property Fund Limited and AEW Oriole Co-Investment LLC is now offering $38.50 per share for Town and Country, up from $36.
Prior to the increased offer, Town and Country already had determined that Oriole Partnership's $36-per-share bid was superior to the agreement it has in place with the Morgan Stanley Real Estate-Onex Real Estate JV known as Magazine Acquisition LLC. However, Town and Country has not yet made a determination about Berkshire Property Investors' 11th-hour $37 proposal because Berkshire has not made the offer definitive, and Magazine Acquisition still has the right to match the best offer and remain in first position.
The increased offer by Oriole Partnership now makes it more of a stretch for the Morgan Stanley-Onex JV--the original suitor--to match the offer. It also eclipses the 11th-hour $37 offer by Berkshire Property Investors.
Magazine Acquisition has until noon Wednesday to match the offer and Town and Country. If it does, Town and Country likely will continue to recommend the Magazine Acquisition merger agreement, which shareholders are scheduled to vote on in early march. If Magazine Acquisition does not match the offer, Town and Country likely will recommend the Oriole Partnership offer. That is, assuming Berkshire Property Investors doesn't make a higher definitive offer; as of Monday morning, Berkshire's $37 offer is only a proposal and therefore cannot be officially considered by Town and Country.
All offers are to acquire all of the outstanding common shares and limited partnership units of Baltimore-based Town and Country Trust. Town and Country Trust has about 17.5 million shares outstanding plus an additional 19.9 million partnership units, according to SEC filings. Including debt assumption, all three deals are valued between $1.3 billion and $1.4 billion.
Town and Country owns and operates 38 apartment communities with 13,183 apartment homes in the Mid-Atlantic States and Florida. Essex Property Trust is a multifamily REIT with ownership interests in 26,800 units in 127 properties. Berkshire Property Advisors is a Boston-based private company with about 18,000 apartment units under management. Onex Real Estate, an affiliate of Toronto-based Onex Corp., was formed in January to invest in real estate assets in North America and New York-based Morgan Stanley Real Estate manages $38 billion of real estate on behalf of institutional clients.
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