CommonWealth REIT Files Preliminary Consent Revocation Materials
18 Março 2013 - 10:12AM
Business Wire
CommonWealth REIT (NYSE: CWH) (“CommonWealth” or “the Company”)
today announced that it has filed preliminary consent revocation
materials with the Securities and Exchange Commission (the "SEC")
in response to the preliminary consent solicitation statement filed
on March 13, 2013 by Corvex Management LP ("Corvex") and Related
Fund Management, LLC ("Related").
Shareholders are urged to take no action at this time with
respect to the possible consent solicitation. Under federal
securities laws, no written consent may be solicited by Corvex and
Related until after the SEC’s review of their preliminary consent
solicitation materials is completed and definitive materials are
filed and mailed to all CommonWealth shareholders.
The CommonWealth Board believes that a wholesale removal of the
Company’s Trustees without cause is not in the best interest of the
Company and would bring material harm and disruption to the
business and operations of the Company. The Board notes that Corvex
and Related are asking CommonWealth shareholders to relinquish
control of the Company without committing to pay a control premium,
or even any amount, for the outstanding CommonWealth common
shares.
Furthermore, CommonWealth notes that its experienced and
seasoned Board and management team have been instrumental in
building the Company’s current asset portfolio and have critical
knowledge of the Company’s operations and properties. This team is
successfully executing on CommonWealth’s business plan,
including:
- Positioning the Company to best
capitalize on a rebound in the office building real estate market
by repositioning the portfolio more towards large Class A office
properties in urban, or central business district (“CBD”),
locations and away from suburban office and industrial
properties;
- Strengthening the portfolio by selling
$1.5 billion worth of properties, consisting largely of suburban
office properties, since December 31, 2007 and principally buying
CBD office buildings with the sale proceeds;
- Enhancing CommonWealth’s financial
strength by taking actions to pay down indebtedness, including
using the aggregate net proceeds of $867.7 million from the
recently completed public offering of common shares and sale of the
Company’s minority interest in Government Properties Income Trust
to reduce its outstanding indebtedness; and
- Protecting the Company’s strong balance
sheet and maintaining an investment grade credit rating, which the
Board believes is important to the Company’s continued business
success because it provides greater financial flexibility to access
capital, enables the Company to carry out its business plan and
provides it with an advantage when competing for tenants for its
properties.
CommonWealth also notes that its management structure provides
shareholders with numerous advantages as compared to self-managed
REITs, including:
- Reit Management & Research LLC
(“RMR”) provides high quality management services to CommonWealth
at or below industry average costs and fees paid to CommonWealth’s
Trustees are at or below industry averages;
- CommonWealth’s general and
administrative (“G&A”) expenses have historically been equal to
or lower than the average G&A expenses for comparable office
REITs as measured both as a percentage of gross revenues and as a
percentage of gross assets; and
- Management fees charged to CommonWealth
by RMR are less than the fees paid by other REITs with similar
management contracts.
CommonWealth’s Board and management team are committed to
enhancing value for all CommonWealth shareholders. Corvex and
Related have announced that they intend to solicit consents in
order to remove all five of CommonWealth’s experienced Trustees
without cause. If successful, the removal of the Board would leave
the Company without any oversight of its business until a special
meeting is held and an unidentified replacement Board is elected.
CommonWealth is confident that it is in the best interests of all
shareholders for the current Board to continue overseeing the
successful execution of its business plan to enhance value for all
CommonWealth shareholders.
CommonWealth issued the following
statement:
CommonWealth has a strong Board of Trustees
with a broad range of experience. The CommonWealth Board and
management team have been and remain intensely focused on acting in
the best interests of the Company, and are successfully executing
on a business plan to enhance value for all shareholders. We are
confident that we are taking the right steps to improve performance
and that we have the right team in place to deliver on our
objectives.
Rather than creating value for all of
CommonWealth’s shareholders, we believe that Corvex and Related are
primarily interested in reputation building, as demonstrated by the
remarkable effort they have undertaken to generate media interest
in their self-serving activism campaign against CommonWealth’s
Board. We believe that only Corvex and Related stand to benefit
from their consent solicitation campaign, and that shareholders
should reject their self-serving effort to seize CommonWealth.
Finally, we are disappointed that Corvex and
Related are pursuing more meritless legal claims, following their
defeat in Federal Court two weeks ago. We are confident that we
will continue to prevail in Court, and we look forward to engaging
with investors and analysts in the weeks ahead to discuss why the
removal of all CommonWealth’s Trustees without cause would not be
in the best interests of the Company.
COMMONWEALTH WILL RECOMMEND THAT SHAREHOLDERS NOT SUBMIT THE
CONSENTS SOLICITED BY CORVEX AND RELATED AND THAT SHAREHOLDERS
REVOKE ANY CONSENT PREVIOUSLY PROVIDED TO CORVEX AND RELATED.
CommonWealth has made a filing with the SEC of a preliminary
Consent Revocation Statement and an accompanying preliminary
Consent Revocation Card to be used to solicit revocations of
written consents in connection with the solicitation of written
consents by Corvex and Related from shareholders of CommonWealth.
Promptly after filing its definitive Consent Revocation Statement
with the SEC, CommonWealth will mail the definitive Consent
Revocation Statement and a BLUE Consent Revocation Card to each
shareholder entitled to deliver a written consent in connection
with the consent solicitation.
The Company, it’s Trustees and certain of its executive officers
and RMR and certain of its directors, officers and employees may be
deemed to be participants in the solicitation of consent
revocations from shareholders in connection with the consent
solicitation being conducted by Corvex Management LP and Related
Fund Management, LLC (the "Consent Solicitation"). On March 18,
2013, the Company filed a preliminary consent revocation statement
with the SEC in response to the Consent Solicitation. The Company
will furnish a definitive consent revocation statement to its
shareholders, together with a BLUE consent revocation card when
available. SHAREHOLDERS ARE URGED TO READ THE CONSENT REVOCATION
STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY
OTHER RELEVANT DOCUMENTS THAT THE COMPANY WILL FILE WITH THE SEC
WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION. Additional information regarding the identity of these
potential participants and their direct or indirect interests, by
share holdings or otherwise, is set forth in the preliminary
consent revocation statement and other materials to be filed with
the SEC in connection with the Consent Solicitation.
Shareholders will be able to obtain, free of charge, copies of
the consent revocation statement and any other documents to be
filed by the Company with the SEC in connection with the Consent
Solicitation at the SEC's website (http://www.sec.gov), at the
Company's website (http://www.cwhreit.com) or by requesting
materials from the firm assisting the Company in the solicitation
of consent revocations, Innisfree M&A Incorporated, toll-free
at 877-750-5836.
A Maryland Real Estate Investment Trust with
transferable shares of beneficial interest listed on the New York
Stock Exchange. No shareholder, Trustee or officer is personally
liable for any act or obligation of the Trust.
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