Gables Residential (NYSE:GBP)
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ING Clarion Partnership to Acquire Gables for Cash
AMSTERDAM and BOCA RATON, Fla., June 7 /PRNewswire-FirstCall/ -- Gables
Residential Trust (NYSE:GBP) ("Gables" or the "Company") and a private equity
partnership sponsored by ING Clarion Partners ("ING Clarion"), a wholly-owned
subsidiary of ING Groep, NV of the Netherlands ("ING"), announced today that a
partnership managed by ING Clarion has entered into a definitive agreement to
acquire the Company. The transaction represents the largest public to private
REIT transaction in the multifamily sector.
Under the terms of the agreement, the ING Clarion partnership will acquire all
of Gables' common stock for $43.50 per share in cash. The per share purchase
price represents a 14% premium over Gables closing share price on June 6, 2005,
and an 18% premium over the prior 10 day average share price. The total
consideration is approximately $2.8 billion, which includes the assumption and
refinancing of approximately $1.2 billion of the Company's outstanding debt and
the Company's outstanding Series C-1, Series D and Series Z preferred shares,
which have a liquidation preference of approximately $120 million.
Completion of the transaction, which is expected to occur by the end of the
third quarter of 2005, is subject to approval by the Company's common
shareholders and certain other customary closing conditions. The transaction
has been unanimously approved by the Company's Board of Trustees, which will
recommend that the common shareholders approve the transaction. Gables will
continue to pay regular monthly dividends at an annualized rate of $2.41 per
share through the closing of the transaction, including a pro rated dividend
for the month in which the transaction closes.
Holders of limited partnership interests in the Company's operating partnership
will be given the choice of either receiving $43.50 in cash or participating
through a limited partnership interest in an affiliate of the buyer.
"The quality of our organization and assets is evident in ING Clarion's
valuation. We believe that this transaction represents a compelling value for
our shareholders," noted Chris Wheeler, Executive Chairman.
"The transaction with ING Clarion demonstrates the intrinsic value of our
associates and their ability to generate returns for our investors," said David
Fitch, CEO. "This is great for both our shareholders and associates, allowing
us to continue to execute our real estate strategy on a go-forward basis in a
private setting."
ING Clarion, the managing partner of the new partnership, will provide
strategic oversight, fund governance and portfolio management skills to capture
the benefits afforded by the private sector. These benefits are anticipated to
include operating more opportunistically and with higher leverage, increasing
development activities, entering new markets, and eliminating public company
costs.
The transaction is being financed by $400 million of equity provided by ING
with the balance of the debt and equity capital arranged by Lehman Brothers
Inc. and its affiliates ("Lehman Brothers").
ING Clarion is a U.S. real estate investment firm with approximately $22
billion under management, including a multifamily portfolio of approximately
10,000 apartments. ING Clarion is a wholly owned subsidiary of ING Real
Estate, a global real estate investment firm with $69 billion of assets under
management, making it one the largest in the world. ING Real Estate is owned
by ING, a global financial services firm specializing in insurance, banking and
asset management.
Wachovia Securities acted as financial advisor to Gables and Goodwin Procter
LLP provided legal advice. Lehman Brothers Inc. acted as financial advisor to
ING Clarion. King & Spalding LLP provided legal counsel to ING Clarion and
Hogan & Hartson LLP, Weil Gotshal & Manges LLP, and Cadwalader, Wickersham &
Taft provided legal counsel to Lehman Brothers.
Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995
This release, including the Supplements, contains forward-looking statements
within the meaning of federal securities laws. These forward- looking
statements reflect the Company's current views with respect to the future
events or financial performance discussed in this release, based on
management's beliefs and assumptions and information currently available. When
used, the words "believe," "anticipate," "estimate," "project," "should,"
"expect," "plan," "assume" and similar expressions that do not relate solely to
historical matters identify forward-looking statements.
Forward-looking statements in this release include, without limitation,
statements relating to the anticipated closing date of the transaction, the
Company's ability to generate attractive returns, and the possibility that any
of the conditions to closing, including those outside the Company's control,
will be satisfied. Forward-looking statements are subject to risks,
uncertainties and assumptions and are not guarantees of future events or
performance, which may be affected by known and unknown risks, trends and
uncertainties. Should one or more of these risks or uncertainties materialize,
or should the Company's assumptions prove incorrect, actual results may vary
materially from those anticipated, projected or implied in the forward-looking
statements. Factors that may cause such a variance include, among others: local
and national economic and market conditions, including changes in occupancy
rates, rental rates, and job growth; the demand for apartment homes in the
Company's current and proposed markets; the uncertainties associated with the
Company's current real estate development, including actual costs exceeding the
Company's budgets; changes in construction costs; construction delays due to
the unavailability of materials or weather conditions; the failure to sell
assets on favorable terms, in a timely manner or at all; the failure of
acquisitions to yield anticipated results; the cost and availability of
financing; changes in interest rates; competition; the effects of the Company's
accounting and other policies; and additional factors discussed from time to
time in the Company's filings with the Securities and Exchange Commission. The
Company expressly disclaims any responsibility to update forward-looking
statements to reflect changes in underlying assumptions or factors, new
information, future events or otherwise.
About Gables
With a mission of Taking Care of the Way People Live(R), Gables Residential has
received national recognition for excellence in the management, development,
acquisition and construction of luxury multifamily communities in high job
growth markets. The Company's strategic objective is to produce total returns
through monthly dividends and share price changes that exceed the NAREIT
apartment sector index.
The Company has a research-driven strategy focused on markets characterized by
high job growth and resiliency to national economic downturns. Within these
markets, the Company targets Established Premium Neighborhoods(TM) ("EPN's"),
generally defined as areas with high per square foot prices for single-family
homes. By investing in resilient, demand-driven markets and EPN(TM) locations
with barriers to entry, the Company expects to achieve its strategic objective.
The Company is one of the largest apartment operators in the nation and
currently manages 41,750 apartment homes in 162 communities. The Company owns
or has an interest in 84 communities it owns with 21,163 stabilized apartment
homes primarily in Atlanta, Houston, South Florida, Austin, Dallas, Washington,
D.C. and San Diego/Inland Empire and has an additional 11 communities with
2,673 apartment homes under development or lease-up.
For further information, please contact Gables Investor Relations at (800)
371-2819 or access Gables' website at http://www.gables.com/.
Additional Information about the Merger and Where to Find It
In connection with the proposed merger of Gables with and into a wholly owned
subsidiary of ING Clarion and Lehman Brothers, Gables intends to file relevant
materials with the Securities and Exchange Commission, including a proxy
statement. INVESTORS AND SECURITY HOLDERS OF GABLES ARE URGED TO READ THESE
MATERIALS WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT GABLES, ING CLARION, LEHMAN BROTHERS AND THE MERGER. The
proxy statement and other relevant materials (when they become available) and
any other documents filed by Gables with the SEC may be obtained free of charge
at the SEC's website at http://www.sec.gov/. In addition, investors and
security holders may obtain free copies of the documents filed with the SEC by
Gables by contacting Gables Investor Relations at (800) 371-2819 or accessing
Gables' investor relations website. Investors and security holders are urged
to read the proxy statement and the other relevant materials when they become
available before making any voting or investment decision with respect to the
merger.
Gables, ING Clarion, Lehman Brothers and their respective executive officers,
trust managers and directors may be deemed to be participating in the
solicitation of proxies from the security holders of Gables in connection with
the merger. Information about the executive officers and trust managers of
Gables and the number of Gables common shares beneficially owned by such
persons is set forth in the proxy statement for Gables' 2005 Annual Meeting of
Stockholders, which was filed with the SEC on April 1, 2005. Also disclosed in
the proxy statement for Gables' 2005 Annual Meeting of Stockholders is the
number of Gables common shares beneficially owned by certain affiliates of ING
Clarion. Investors and security holders may obtain additional information
regarding the direct and indirect interests of Gables, ING Clarion, Lehman
Brothers and their respective executive officers, trust managers and directors
in the merger by reading the proxy statement regarding the merger when it
becomes available.
This communication shall not constitute an offer to sell or the solicitation of
an offer to sell or the solicitation of an offer to buy any securities, 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 Securities Act of 1933, as amended.
CONTACT:
Marvin R. Banks Jr.
Chief Financial Officer
Gables Residential Trust
(770) 438-5501
DATASOURCE: Gables Residential Trust
CONTACT: Marvin R. Banks Jr., Chief Financial Officer of Gables
Residential Trust, +1-770-438-5501
Web site: http://www.gables.com/