PALO ALTO, CA-In less than two weeks, the top offer for the multifamily REIT Town & Country Trust has risen by more than 16.5%, from $33.90- to $39.50 per share and partnership unit. The Baltimore-based public company, which has 37.4 million outstanding shares and partnership units, owns and operates 38 apartment communities with 13,183 apartment homes in the Mid-Atlantic states and Florida. The high offer translates to total deal value in the vicinity of $1.5 billion.
The original suitor in the deal, the Morgan Stanley Real Estate-Onex Real Estate joint venture Magazine Acquisition LLC, can stay in the driver's seat by raising its offer by midnight tonight to $39.50 per share and partnership unit, the new high-water market set late last week by the JV led by locally based Essex Property Trust (Oriole Partnership). If it does so and Oriole Partnership doesn't again top that bid, then Town and Country must continue to recommend to shareholders that they approve the merger with Magazine Acquisition at a shareholder meeting scheduled for early March.
If Magazine does not match Oriole's offer, then Town and Country on Tuesday can terminate the deal and change its recommendation to its shareholders at a cost of $20 million. Oriole Partnership reportedly will cover that potential termination fee to Magazine Acquisition as part of its offer. Essex partners in Oriole include UBS Wealth Management's North American Property Fund Limited and AEW Oriole Co-Investment LLC.
Magazine Acquisition's original $33.90 offer was turned into a definitive merger agreement in December. On Jan. 31, Oriole Partnership jumped into the game with a $36 offer. On Feb. 6, it raised its offer to $38.50 to top by $1.50 an offer by Berkshire Property Investors, which has been quiet ever since. On Feb. 8, Magazine Acquisition raised its bid to $39 only to see it quickly topped by Oriole, which is the current high bidder at $39.50.
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