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Blackstone Moves to Wrap up Equity Office Properties Deal
NEW YORK – REIT Review.com – February 6, 2007 – In an apparent effort to wrap up the bidding war over Equity Office Properties Trust (NYSE: EOP) private equity firm Blackstone Group raised their $54 per share all cash offer by $1.50 a share to $55.50; the new offer came in response to Vornado Realty Trust’s (NYSE: VNO) $56 per share cash and equity bid. In an early mourning announcement, Equity Office Products board accepted the increased offer and recommended that shareholders approve the deal in the ballot scheduled for February 7, 2007.
Equity office products board described several reasons for their support of the Blackstone bid. Their reasons primarily focused on the higher current cash value of the offer, along with uncertainty and risk related to the equity compensation portion of the Vornado bid.
The higher bid for Equity Office Products helped boost the overall Office REIT sector, with gainers outnumbering losers by over 4-1 in the REIT Review Office REIT Sector just before the close of trading today. The gainers included: Alexandria RE Equities (NYSE: ARE), Brandywine Realty Trust (NYSE: BDN), Biomed Realty Trust (NYSE: BMR), Brookfield Properties Corp (NYSE: BPO), Boston Properties (NYSE: BXP), Digital Realty Trust (NYSE: DLR), Equity Office Properties EOP, Kilroy Realty Corp. (NYSE: KRC), Liberty Property Trust (NYSE: LRY), Capital Lease Funding (NYSE: LSE), Maguire Properties (NYSE: MPG), Mission West Properties (NYSE: MSW), Corporate Office Properties Trust (NYSE: OFC), Republic Property Trust (NYSE: RPB) and SL Green Realty Corp. (NYSE: SLG). Among the few issues losing ground were Citigroup Global Mkts. Principal Protected Eq (NYSE: PDY), and Mack-Cali Realty Corp. (NYSE: CLI).
With the Tuesday vote rapidly approaching, it will be interesting to see if Vornado comes back with a last minute offer to try and top Blackstone’s latest bid.