KENNER, LA-Compson Holding Corp. of Boca Raton, FL is fine-tuning a counter offer for Sizeler Property Investors Inc.'s multifamily and retail portfolio after having its opening salvo of $15.50 per share set aside for a lower bid from Toronto-based Revenue Properties Co. Ltd.
Compson is a 1% stakeholder in Sizeler. Its president Michael A. Comparato says he's garnered support from several other shareholders to go head-to-head to block the Canadian firm's $324-million offer, which was deemed fair from a financial standpoint by Sizeler advisors Wachovia Securities and Cohen & Steers in an SEC filing. Because the deal's still in play, Wachovia's not commenting about its determination.
"I can't say it's inappropriate. I just know the real estate is worth a whole lot more than $15.10. We were shocked the price was that low," Comparato tells GlobeSt.com. "We offered $15.50 per share. We were told there were other potential buyers in the same range. As we watched, the price eventually went up above $16 per share and then it's announced that the deal was $15.10."
Comparato says his offer called for a 14-day stand-down from the marketing to allow more due diligence time. "Apparently the company wasn't willing to take the assets off the market for two weeks," he says. "$15.50 was just our initial, out-of-the-box offer. Obviously we were willing to go higher than that. That they took a deal lower than ours just blows my mind." The portfolio consists of an estimated 3.4 million sf of retail space in 13 shopping centers and two enclosed malls and about three million sf in 15 multifamily properties in Louisiana, Florida and Alabama.
"The likelihood of this deal happening at $15.10 is very unlikely," Comparato stresses. "The price is unacceptable to shareholders. I'll be astonished if there wasn't extensive litigation."
Comparato says he is planning to put in an offer early next week that will once again beat Revenue Properties' bid, which is backed by Morguard Corp. The tentative bid is being set up to include 30 cents per share for the breakup fee, he adds. "We will get the best price for us and at the same time get a little more value for the shareholders," he stresses.
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