March 2005
Confirming rumors that have been circulating for several weeks, Prime Group Realty trust has officially entered into a merger agreement with an affiliate of the Lightstone Group. The Chicago-based REIT’s board of directors unanimously approved the deal and intends to recommend it for approval by the common shareholders, in spite of a current lawsuit filed by Chicago-based REIT’s former chairman over the sale of the company. (See News Wrap, January 2005.)
The price tag for the merger is roughly 889.4 million. According to terms of the agreement, Lakewood, NJ- based Lightstone will pay $725 in cash for the common share and limited partner units of Prime Group, and will assume some $595.4 million in debt.
|
 |
The transaction is not subject to financing conditions and is expected to close during the second quarter or early in the third quarter. Winston & Stawn LLP was legal counsel for Prime Group, while Wachovia Securities served as financial adviser. The New York City-base law firm of Herrick, Feinstein LLP spoke for Lightstone.
“Part of our business strategy is to acquire firm with good management teams and high-quality assists in locations we believe provide opportunities as markets recover. We believe the acquisition of Prime group fits this strategy,” said David Lichtenstein, chairman and principal of Lightstone, which has purchased more than $ billion in real estate over the past years. The company owns more than
|
|
16,000 residential units and 26 million sf of office, retail, and industrial space in the US and Puerto Rico.
Prime Group bring to the table 11 office building totaling 4.6 million sf, a 120,000-sf industrial asset and 9.3 acres of developable land, in addition to JV interested in three properties totaling 2.8 million-sf.
|
