Brookfield Fund To Buy Forest City In $11.4 Bln Deal

(RTTNews) - Brookfield Asset Management Inc. (BAM, BAM_A.TO) and Forest City Realty Trust, Inc. (CEA) announced that they have entered into a definitive agreement under which a Brookfield real estate investment fund will acquire all of the outstanding shares of common stock of Forest City for $25.35 per share in an all-cash transaction valued at $11.4 billion, including Forest City's proportionate share of consolidated and unconsolidated debt.

The purchase price represents a premium of 26.6 percent over Forest City's closing share price of $20.03 on June 15, 2018, the day prior to recent market speculation that Brookfield was engaging in discussions to acquire Forest City.

The proposed transaction has been recommended by the Board of Directors of Forest City and is expected to close in the fourth quarter of 2018.

The Forest City portfolio is comprised of a number of iconic assets across major gateway U.S. cities, including 6.3 million square feet of high-quality office space, 2.3 million square feet of premier life science assets, primarily in Cambridge, MA, 2.2 million square feet of retail space and 18,500 multifamily units, as well as five large-scale development projects in the New York Metro area, San Francisco and Washington, D.C.

In connection with the transaction, affiliates of Starboard Value LP and Scopia Capital Management LP, which own approximately 14% of Forest City's outstanding shares in the aggregate, have entered into merger support agreements whereby they have agreed to vote their shares in favor of the transaction at the Forest City special meeting.

Completion of the transaction is subject to certain closing conditions, including the approval of Forest City's stockholders. The transaction is not contingent on receipt of financing.

Forest City does not expect to pay its regular quarterly dividend during the pendency of the transaction.

Due to the pending acquisition, Forest City will not be holding a conference call for its second quarter 2018 business results.