Monmouth Real Estate Investment Corporation (NYSE: MNR, “Monmouth”
or “the Company”) today released an investor presentation
highlighting the significant value and other benefits of the
Company’s pending merger with Equity Commonwealth (NYSE: EQC,
“EQC”). The presentation, which is on file with the Securities and
Exchange Commission, is available on the investor relations page of
Monmouth’s website at
https://investors.mreic.reit/corporate-profile/default.aspx.
As outlined in the presentation, the Monmouth
Board is confident that the EQC transaction is the best option to
maximize long-term value for stockholders. Highlights include:
- Robust
strategic
review
process. The transaction is the
culmination of an extensive strategic review conducted by the
Monmouth Board. The Board, working together with its legal and
financial advisors, engaged with and solicited proposals from a
broad range of investors, contacting over 90 different potential
counterparties and evaluating a number of strategic alternatives
before determining the merger with EQC to be the best outcome for
stockholders.
- Compelling
value for
Monmouth
stockholders. The transaction
represents a 26% valuation premium to Monmouth’s 30-day average
unaffected trading price as of December 18, 2020 and an approximate
4.6% cap rate for our high-quality single-tenant industrial
portfolio leased primarily to investment grade tenants.
- Significant
combined
company
upside
potential
supported by
highly
favorable
secular
trends. The
transaction provides Monmouth stockholders with the opportunity to
participate in the success of the combined company as it executes
its growth strategy and evolves into a market leading industrial
REIT benefitting from strong industrial real estate sector
fundamentals driven by the rapidly growing e-commerce
industry.
-
World-class
management
team. The merger
enables Monmouth stockholders to benefit from the expertise and
proven track record of EQC’s executive team, led by Sam Zell as
Chairman and David Helfand as CEO.
- Acquisition
strategy to
strengthen and
diversify
industrial
portfolio. The combined company
intends to grow through acquisitions utilizing its approximately $5
billion of balance sheet capacity and will seek to diversify the
portfolio while expanding its tenant base.
- Fully-funded
growth
strategy. The
stable and recurring cash flows of Monmouth’s portfolio, coupled
with EQC’s considerable financial resources, including
approximately $2.4 billion in cash following close, will fund the
combined company’s growth strategy without having to access the
debt or equity capital markets for the foreseeable future.
- Lower costs
and increased
liquidity.
Stockholders of the combined company will benefit from
approximately $34 million per year in savings following the payoff
of Monmouth’s Series C Preferred. In addition, the post-merger
public equity market capitalization of approximately $5.1 billion
is expected to provide increased liquidity for stockholders.
-
Tax-efficient
stock
transaction.
This tax-efficient transaction will allow Monmouth common
stockholders to defer unrealized gains that would otherwise be
realized in a cash sale.
The Monmouth Board of Directors (the “Board”)
unanimously recommends that stockholders complete and return the
WHITE proxy card to vote their shares
“FOR” the merger in advance of the upcoming
Special Meeting of Stockholders, which is scheduled to be held on
August 24, 2021 at 11:00 a.m. EDT.
The transaction is expected to close in the
second half of 2021, subject to customary closing conditions,
including approval by the common stockholders of both Equity
Commonwealth and Monmouth. The Board of Trustees of Equity
Commonwealth and the Board of Directors of Monmouth have each
unanimously approved the transaction.
EVERY VOTE IS
IMPORTANT!MONMOUTH STOCKHOLDERS
ARE ENCOURAGED TO VOTE
“FOR” THE
EQC TRANSACTION ON
THE WHITE PROXY CARD
TODAY!
Monmouth stockholders have received a joint
proxy statement/prospectus prepared by Monmouth and EQC seeking
stockholder approval of the merger. Any stockholder who has
questions about the voting of shares after receiving and reviewing
the joint proxy statement/prospectus may contact Monmouth’s proxy
solicitor, Okapi Partners, toll-free, at (888) 785-6668.
J.P. Morgan Securities LLC and CS Capital
Advisors, LLC are acting as financial advisors and Stroock &
Stroock & Lavan LLP is serving as legal advisor to
Monmouth.
About MonmouthMonmouth Real
Estate Investment Corporation, founded in 1968, is one of the
oldest public equity REITs in the world. We specialize in single
tenant, net-leased industrial properties, subject to long-term
leases, primarily to investment-grade tenants. Monmouth Real Estate
is a fully integrated and self-managed real estate company, whose
property portfolio consists of 121 properties, containing a total
of approximately 24.7 million rentable square feet, geographically
diversified across 32 states. Our occupancy rate as of this date is
99.7%.
Forward-Looking Statements
Some of the statements contained in this press
release constitute forward-looking statements within the meaning of
the federal securities laws, including, but not limited to,
statements regarding the merger with EQC. Any forward-looking
statements contained in this press release are intended to be made
pursuant to the safe harbor provisions of Section 21E of the
Securities Exchange Act of 1934, as amended. Forward-looking
statements relate to expectations, beliefs, projections, future
plans and strategies, anticipated events or trends and similar
expressions concerning matters that are not historical facts. In
some cases, you can identify forward-looking statements by the use
of forward looking terminology such as “may,” “will,” “should,”
“expects,” “intends,” “plans,” “anticipates,” “believes,”
“estimates,” “predicts,” “potential,” or the negative of these
words and phrases or similar words or phrases which are predictions
of or indicate future events or trends and which do not relate
solely to historical matters. You can also identify forward looking
statements by discussions of strategy, plans or intentions. Any
forward-looking statements contained in this press release reflect
Monmouth’s current views about future events and are subject to
numerous known and unknown risks, uncertainties, assumptions and
changes in circumstances that may cause actual results to differ
significantly from those expressed in any forward-looking
statement. For a further discussion of other factors that could
cause Monmouth’s future results to differ materially from any
forward-looking statements, see the section entitled “Risk Factors”
in Monmouth’s most recent Annual Report on Form 10-K and in its
Quarterly Reports on Form 10-Q. While forward-looking statements
reflect Monmouth’s good faith beliefs, they are not guarantees of
future performance. Monmouth disclaims any obligation to publicly
update or revise any forward-looking statement to reflect changes
in underlying assumptions or factors, of new information, data or
methods, future events or other changes.
Participants in the Solicitation
Monmouth and certain of its directors and
executive officers and other employees may be deemed to be
participants in the solicitation of proxies from Monmouth’s
stockholders in connection with the proposed merger with EQC under
the rules of the SEC. Investors may obtain information regarding
the names, affiliations and interests of directors and executive
officers of Monmouth in Monmouth’s Annual Report on Form 10-K for
Monmouth’s fiscal year ended September 30, 2020, which was filed
with the SEC on November 23, 2020, as well as in Monmouth’s other
filings with the SEC. Other information regarding the participants
in the proxy solicitation and a description of their direct and
indirect interests, by security holdings or otherwise, is contained
in the proxy statement/prospectus and other relevant proxy
materials filed with the SEC in respect of the proposed merger.
No Offer or Solicitation
This communication is not intended to and shall
not constitute an offer to buy or sell or the solicitation of an
offer to buy or sell any securities, or a solicitation of any vote
or approval, nor shall there be any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offering of securities
shall be made, except by means of a prospectus meeting the
requirements of Section 10 of the U.S. Securities Act of 1933, as
amended.
Additional Information and Where to Find It
In connection with the proposed merger between
Monmouth and EQC, EQC has filed a registration statement on Form
S-4 with the SEC, which became effective on July 23, 2021, to
register the common shares of beneficial interest of EQC to be
issued pursuant to the merger. The registration statement includes
a joint proxy statement/prospectus which has been filed by EQC and
Monmouth with the SEC and has been sent to the common shareholders
of EQC seeking their approval of the share issuance and to the
common shareholders of Monmouth seeking their approval of the
merger (the “joint proxy statement/prospectus”). EQC and Monmouth
may also file other documents regarding the proposed merger and
share issuance with the SEC. BEFORE MAKING ANY VOTING OR INVESTMENT
DECISION, INVESTORS AND SECURITY HOLDERS ARE URGED TO CAREFULLY
READ THE ENTIRE REGISTRATION STATEMENT AND THE JOINT PROXY
STATEMENT/PROSPECTUS, AND ANY OTHER RELEVANT DOCUMENTS FILED WITH
THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE
DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN
IMPORTANT INFORMATION ABOUT THE PROPOSED MERGER AND SHARE ISSUANCE.
Investors and security holders may obtain free copies of the
registration statement and joint proxy statement/prospectus and
other documents filed with the SEC by EQC or Monmouth through the
website maintained by the SEC at www.sec.gov. In addition,
investors and security holders may obtain free copies of the
registration statement and the joint proxy statement/prospectus and
other documents filed with the SEC by EQC on EQC’s website at
www.eqcre.com and may obtain free copies of the joint proxy
statement/prospectus and other documents filed with the SEC by
Monmouth on Monmouth’s website at www.mreic.reit.
Contacts:Investors Becky
Coleridge (732) 577-9996 mreic@mreic.com
Media Andrew Siegel / Amy Feng / Kara Brickman
Joele Frank (212) 355-4449
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