Schorsch's American Realty to acquire Cole Real Estate in $6.85B deal

Offer is 14% higher than Cole's closing price; deal approved by both companies' boards

Oct 23, 2013 @ 7:59 am

american realty capital, reits, real estate, cole real estate, nicholas schorsch
+ Zoom
Deal on: Cole CEO Marc Nemer (left) with ARCP chairman and chief executive Nicholas S. Schorsch. (PRNewsFoto/American Realty Capital Properties, Inc.)

American Realty Capital Properties has agreed to buy Cole Real Estate Investments for $6.85 billion to add a manager of retail, office and industrial properties to REIT mogul Nicholas Schorsch's growing stable of holdings.

American Realty Capital will pay 1.0929 common shares valued at $14.59 for each Cole share or $13.82 in cash, the companies said in a statement Wednesday. The offer is 14% higher than Cole's closing price yesterday. The merger has been approved by both companies' boards, according to the statement.

Take a closer look at Nick Schorsch's acquisition strategy

“Far more can be accomplished by these two great companies working together than either one could have hoped to achieve independently,” Mr. Schorsch, American Realty Capital chief executive, said in the statement. "This merger represents a new beginning for former competitors, and we look forward to uniting two of the industry's most talented organizations."

American Realty Capital said it had lined up $2.75 billion of financing and the deal is expected to be completed early next year.

In a statement, Mr. Schorsch further downplayed the rivalry between ARCP and Cole.

"We share the same disciplined investment philosophy and investment processes, which are focused on investment grade tenancy, long lease durations, a strong diversified tenant base, and a mix of property type and geography. . . By leveraging our successful track records, our complementary businesses and highly skilled professionals, we are confident that we will be well-positioned to achieve continued growth."

Watch Nick Schorsch: Separating the REITs from the chaff

Meanwhile, Cole's CEO, Marc Nemer, sought to assure brokers that Cole is in good hands. "Our valued broker-dealer and financial adviser relationships will continue to be served by the same distinguished professionals following completion of the merger," he said in a statement. "As I depart the organization, I do so with the conviction that ARCP will continue to execute on these principles under the umbrella of 'best practices' and generate outsize risk-adjusted returns for all of its stockholders."

(Bloomberg News)

0
Comments

What do you think?

View comments

Recommended for you

Sponsored financial news

Featured video

Events

Building a practice for tomorrow's tomorrow

Advisers: it is time to take a long view of your practice. Check out some tips and strategies on how to do it (and why) with Tom Stefaniak of Pinnacle Wealth Management.

Video Spotlight

The Search for Income

Sponsored by PGIM Investments

Recommended Video

Path to growth

Latest news & opinion

T. Rowe Price steps up its game to serve financial advisers

The Baltimore-based mutual fund giant is more aggressively targeting financial advisers with a beefed-up wholesale crew and placement on custodial platforms.

The most important tax changes for 2018

The Internal Revenue Service issued inflation adjustments to more than 50 tax provisions for 2018.

Shift to Roth 401(k)s 'highly likely' part of tax reform: former Treasury official Mark Iwry

Mandated contributions to Roth accounts would likely only be partial, as opposed to having a full repeal of pre-tax accounts.

E*Trade acquiring custodian Trust Company of America

Discount broker buying second-tier custodian for $275 million.

Another thousand Dow points higher, and investors yawn

Market milestones keep falling like dominoes, with 51 records broken so far this year.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print