Btb doing a dealPress release from CNW Group
BTB REIT to pursue its growth by entering into a definitive agreement to acquire Cagim Real Estate Corporation
Friday, March 26, 2010
MONTREAL, March 26/CNW Telbec/ - BTB Real Estate Investment Trust ("BTB") (TSX-V: BTB.UN)announced today that it has entered into a definitive support agreementwith Cagim Real Estate Corporation ("Cagim") (TSX-V: CIM) that providesfor an offer (the "Offer") to be made by BTB, by way of a take-overbid, to purchase all of the outstanding common shares of Cagim, for$1.05 per share in cash (the "Offer Price"). The Offer has the full support of the Board of Directors of Cagim.
The transaction, including the assumption of debt by BTB, values Cagim at approximately $21.5 million.The all-cash Offer represents a premium of approximately 43% over the20-day volume weighted average trading price for Cagim common shares onthe TSX Venture Exchange throughMarch 26, 2010 and of approximately 40% over the closing price on the last trading day prior to this announcement.
Shareholders owning approximately 40% of Cagim's issued andoutstanding common shares on a fully diluted basis, including someOfficers and Directors of Cagim, have entered into lockup agreementssupporting the Offer.
Cagim has a quality real estate portfolio, most of which is located in the Lebourgneuf district, an exiting area of QuebecCity. Cagim's portfolio consists of six buildings totaling more than600,000 square feet. Cagim has a 50% interest in three of thesebuildings. Cagim's real estate portfolio has been valued atapproximately$48,000,000 by Altus. These buildings provide positive cash flows and will contribute to an increase of BTB's Net Operating Income
Following this acquisition, BTB will own 49 buildings for a total of more than 2,900,000 square feet.
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"We are delighted to have entered into an agreement with Cagim that will
allow us to pursue our growth plan that was put on hold during the
financial crisis that shocked the global capital markets at the end of
2008 and in 2009. This acquisition will add six high quality buildings to
our current portfolio of 43 buildings, thus increasing the value of our
portfolio to approximately 280 million dollars and 2.9 million square
feet. This acquisition falls squarely within our plan resulting from the
strategic planning of the Board of Trustees during the fall of 2009 and
will allow for synergies and savings that will contribute to increase the
financial performance of BTB" has declared Mr. Michel Léonard, President
and Chief Executive Officer of BTB.
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Full details of the Offer will be included in the formal offer andtake-over bid circular that is expected to be mailed to Cagimshareholders shortly. BTB's take-over bid circular will be accompaniedby a directors' circular of Cagim, which will provide shareholders ofCagim with, among other things, the reasons for the recommendation ofthe Cagim Board of Directors that Cagim shareholders accept the Offer.The Offer shall be valid for at least 35 days from its inception.
BTB's obligation to acquire Cagim common shares pursuant to theoffer is subject to certain conditions, including: (i) the validdeposit of at least 66 2/3% of the outstanding Cagim common shares (ona fully-diluted basis); (ii) receipt of all required third-partyapprovals; (iii) the non-occurrence of a material adverse effect; and(iv) the completion by Cagim of a pre-closing asset reorganization.
Under the terms of the definitive support agreement, Cagim will pay a termination fee of $750,000,being less than 3.5% of the amount of the Offer, to BTB if thedefinitive support agreement is terminated in the event that Cagimaccepts a superior proposal and in certain other circumstances.
Dundee Securities Corporation acted as financial advisor to BTB.