CRIIMI MAE Agrees to be Acquired for $20.00 Per Common Share in Cash
October 06 2005 - 5:12PM
PR Newswire (US)
ROCKVILLE, Md., Oct. 6 /PRNewswire-FirstCall/ -- CRIIMI MAE Inc.
(NYSE:CMM) today announced that it has agreed to be acquired by CDP
Capital - - Financing Inc., a subsidiary of Caisse de depot et
placement du Quebec. Under the terms and subject to the conditions
of the definitive merger agreement, an indirect subsidiary of CDP
Capital -- Financing, who was advised on the transaction by
CWCapital Investments, will be merged with and into CRIIMI MAE and
CRIIMI MAE's outstanding shares of common stock will each be
converted into $20.00 in cash (the "Merger"). The transaction is
valued at approximately $328 million based on approximately 16.4
million CRIIMI MAE common shares outstanding. CRIIMI MAE's Board of
Directors (the "Board") voted to recommend that its shareholders
approve the Merger based on the unanimous recommendation of its
Special Committee of independent directors. Barry S. Blattman,
Chairman and Chief Executive Officer of CRIIMI MAE, said: "Through
a competitive bidding process, the Board of Directors has helped
our shareholders realize value for their shares at a significant
premium to the current trading price." Robert E. Woods, Chairman of
the Special Committee, said: "This is part of a process that began
in early 2005 when the Board decided to evaluate various strategic
alternatives, including a possible sale of the Company, to maximize
shareholder value. Citigroup Global Markets, the Special
Committee's financial advisor, contacted many interested potential
bidders and assisted the Special Committee throughout the process.
The Special Committee unanimously recommended this transaction to
the full Board as in the best interest of CRIIMI MAE's
shareholders." As soon as reasonably practicable, CRIIMI MAE will
file a proxy statement with the Securities and Exchange Commission
and solicit proxies with respect to the voting of shares of the
Company's common stock for approval of the Merger. The transaction
is subject to customary conditions, including the affirmative vote
of two-thirds of the shares of the Company's common stock
outstanding. BREF One, LLC -- Series A, with approximately 1.2
million common shares (representing approximately 7.8% of the 15.6
million common shares currently outstanding) and a warrant to
acquire an additional 336,835 common shares (or an additional 2%),
has entered into an agreement with CDP Capital - - Financing
pursuant to which it has agreed to vote in favor of the Merger. If
approved by shareholders, the Merger is anticipated to be completed
during the first quarter of 2006. The merger agreement allows
CRIIMI MAE to solicit other acquisition or business combination
proposals until December 1, 2005, and to terminate the merger
agreement and accept a superior proposal upon the reimbursement of
CDP Capital -- Financing's expenses up to an aggregate of $2
million. In addition, if CRIIMI MAE terminates the merger agreement
and accepts a superior proposal on or after January 1, 2006, CRIIMI
MAE would be required to pay an $8 million termination fee to CDP
Capital-Financing in addition to such reimbursement of its
expenses. No shares of CRIIMI MAE's Series B Preferred Stock will
be converted into cash, securities or other property as a result of
the Merger. CRIIMI MAE's Series B Preferred Stock will remain
outstanding following the completion of the Merger without any
change or modification to any right, preference, privilege or
voting power of any such shares or holders, except that such
preferred stock after the Merger will by its terms no longer be
convertible into CRIIMI MAE common stock, but instead will be
convertible into an amount of cash equal to the product of $20.00
and the number of common shares such preferred stock was
convertible into immediately prior to the Merger. About CRIIMI MAE
CRIIMI MAE Inc. is a commercial mortgage company structured as a
REIT. CRIIMI MAE owns and manages a significant portfolio of
commercial mortgage- related assets. Historically, CRIIMI MAE's
primary focus was acquiring high- yielding, non-investment grade
commercial mortgage-backed securities (subordinated CMBS). For
further information, see the Company's web site:
http://www.criimimaeinc.com/. About Caisse de depot et placement du
Quebec The Caisse de depot et placement du Quebec (the "Caisse") is
a financial institution that manages funds primarily for public and
private pension and insurance plans. As of December 31, 2004, the
Caisse held CA$102.4 billion of net assets. The leading
institutional fund manager in Canada, the Caisse invests in major
financial markets as well as in private equity and real estate. For
further information: http://www.lacaisse.com/ About CWCapital
CWCapital Investments ("CWCI") acted as the Caisse's advisor in
connection with the structuring, valuation and negotiation of the
transaction. After closing, CWCI will act as the asset manager for
the underlying assets of the new company. The CWCapital family of
companies provides a full range of capital market services to
borrowers and investors, including asset management, special
servicing and primary servicing, and is a national full service
lender to the commercial and multifamily real estate industries.
With this transaction, CWCapital Investments will increase its
assets under management to over US$5 billion. For more information:
http://www.cwcapital.com/. CRIIMI MAE shareholders and securities
brokers should contact Susan Railey at (301) 255-4740, e-mail , and
news media should contact James Pastore, Pastore Communications
Group LLC, at (202) 546-6451, e-mail . Note: Forward-looking
statements or statements that contain the words "believe,"
"anticipate," "expect," "contemplate," "may," "will" and similar
projections contained in this release involve a variety of risks
and uncertainties. These risks and uncertainties include the risk
that the proposed transaction described above may fail to be
approved by shareholders, the conditions to the closing may not be
satisfied or that the benefits of such transaction fail to be
realized; as well as the risks and uncertainties that are set forth
from time to time in the Company's SEC reports, including its
Annual Report on Form 10-K for the most recent year and Quarterly
Report on Form 10-Q for the most recent quarter. Such statements
are subject to these risks and uncertainties, which could cause
actual results to differ materially from those anticipated. CRIIMI
MAE assumes no obligation to update or supplement forward-looking
statements that become untrue because of subsequent events. This
release may be deemed to be a solicitation by the Board of
Directors of CRIIMI MAE Inc. under the proxy rules of the
Securities and Exchange Commission. A description of the direct or
indirect interests, by security holdings or otherwise, of the
directors of CRIIMI MAE Inc. may be obtained in the CRIIMI MAE
proxy statement dated September 12, 2005 relating to the Annual
Meeting of Stockholders to be held on October 18, 2005, previously
mailed to stockholders of record on August 25, 2005 and filed with
the SEC, or in the proxy statement to be prepared in connection
with the Merger and filed with the SEC. All stockholders should
read the Merger proxy statement when it is available because it
will contain important information. Stockholders will be able to
get the Merger proxy statement, and any other relevant documents,
for free at the SEC's website (http://www.sec.gov/) or from CRIIMI
MAE. DATASOURCE: CRIIMI MAE Inc. CONTACT: For shareholders and
securities brokers: Susan B. Railey of CRIIMI MAE Inc.,
+1-301-255-4740, or for news media: James T. Pastore,
+1-202-546-6451, for CRIIMI MAE Inc. Web site:
http://www.criimimaeinc.com/ http://www.lacaisse.com/
http://www.cwcapital.com/
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