A group of investors in Columbia Property Trust Inc. made an unsolicited proposal to acquire the U.S. real estate investment trust in an all-cash deal that would value it at roughly $2.24 billion. Shares in Columbia rose on the news.
The investor group said in a letter to Columbia’s board it made the non-binding offer Thursday for $19.50 a share, confirming a Bloomberg News report. The price represents a 25% premium to where the company’s shares closed Wednesday.
The group, which consists of Arkhouse Partners LLC, Sapir Organization and 8F Investment Partners Pte. Ltd., said it already owns roughly 3.3% of the company.
“We believe our proposal gives the company’s stockholders—many of whom have already suffered through years of value erosion—an attractive opportunity to obtain immediate liquidity at a full and fair valuation,” the group said in the letter. The letter was signed by Arkhouse Chief Executive Officer Gavriel Kahane, Sapir CEO Alex Sapir and Stephane Farouze, chairman of 8F Investment.
Columbia rose 10.2% to $17.22 at 10:59 a.m. in New York on Thursday, giving the company a market value of about $2 billion.
Columbia confirmed in a statement Thursday it had received the proposal and said it would evaluate it with its legal and financial advisers to determine the best course of action for the company and its shareholders.
The investor group said it has hired advisers, and has arranged a term sheet for financing from an unnamed alternative investment management firm with roughly $50 billion in assets under management, subject to the standard due diligence. It also said it is open to discussing the participation of the company’s officers, employees, and stakeholders in the transaction, although it said that it was not a condition to the proposal.
“Our proposal delivers full value that exceeds what the company can be expected to achieve in the coming years based on the expected public market challenges and leadership’s stated plans. We also believe our proposal would be beneficial to the company’s officers and employees, who we envision working with to grow the company over the long-term in the more forgiving, stable private market,” the group said.