NEW YORK, June 18, 2018 /PRNewswire/ -- W. P. Carey
Inc. (NYSE: WPC), a net lease real estate investment trust,
announced today that its Board of Directors has unanimously
approved a definitive merger agreement pursuant to which Corporate
Property Associates 17 – Global Incorporated ("CPA:17"), a
publicly-held non-traded REIT advised by W. P. Carey, will merge
with and into a subsidiary of W. P. Carey in a stock-for-stock
transaction valued at approximately $6
billion. The transaction has also been approved by CPA:17's
Board of Directors upon the unanimous recommendation of a Special
Committee of CPA:17's independent directors. The merger is
currently expected to close at or around December 31, 2018, subject to the satisfaction of
the conditions set forth in the merger agreement, including the
approval of stockholders of each of W. P. Carey and CPA:17.
Subject to the terms and conditions of the merger agreement,
CPA:17 stockholders will receive a fixed exchange ratio of 0.160
shares of W. P. Carey common stock for each share of CPA:17,
equivalent to $10.72 per share based
on W. P. Carey's closing share price of $67.03 as of June 15,
2018.
After the close of the transaction, W. P. Carey is expected to
have a pro forma equity market capitalization of approximately
$11 billion and an enterprise value
of approximately $17 billion, based
upon W. P. Carey's closing share price as of June 15, 2018.
Consistent with its long-term strategy, W. P. Carey currently
anticipates the primary benefits of the transaction to include the
following:
- Improves earnings quality, with approximately 96% of total pro
forma AFFO derived from recurring long-term Real Estate revenues
and approximately 4% derived from finite-life Investment Management
revenues;
- Accelerates its strategy to further simplify its business;
- Adds a high-quality diversified portfolio of net lease assets
that is well-aligned with W. P. Carey's existing portfolio;
- Enhances W. P. Carey's overall portfolio metrics, including
extending weighted-average lease term to 10.4 years and increasing
tenant and industry diversification;
- Significantly increases size, scale and market prominence;
and
- Enhances W. P. Carey's overall credit profile and is expected
to maintain BBB and Baa2 ratings.
"This transaction simplifies our business and effectively
transforms W. P. Carey into a pure-play net lease REIT with
earnings derived almost entirely from higher-multiple lease
revenues," said Jason Fox, W. P.
Carey's Chief Executive Officer. "In addition to creating value by
reweighting our earnings mix and enhancing our credit profile, it
provides a unique and compelling opportunity to acquire a large
portfolio of high-quality assets well-aligned with our existing
portfolio at a favorable cap rate."
J.P. Morgan Securities LLC is acting as lead financial advisor,
Barclays Capital Inc. is acting as co-financial advisor and DLA
Piper LLP (US) is acting as legal advisor to W. P. Carey.
Morgan Stanley & Co. LLC is acting as financial advisor to the
CPA:17 Special Committee. Clifford Chance US LLP is acting as legal
advisor to CPA:17 and Pepper Hamilton LLP is acting as legal
advisor to the CPA:17 Special Committee.
A joint proxy statement/prospectus will be filed on Form S-4
with the Securities and Exchange Commission ("SEC"), which will
describe the proposed merger. Completion of the transaction is
subject to, among other things, effectiveness of the Form S-4,
receipt of all third-party consents as well as the approval of the
stockholders of both companies and satisfaction of customary
closing conditions. The transaction is currently expected to
close at or around December 31, 2018,
although there can be no assurance that the transaction will close
at such time, if at all.
Conference Call and Audio Webcast Scheduled for 8:30 a.m. Eastern Time
The Company will host a conference call and live audio webcast
to discuss this announcement at 8:30 a.m. Eastern Time today,
details of which are provided below.
Date/Time: Monday, June 18, 2018
at 8:30 a.m. Eastern Time
Call-in Number: 1-877-465-1289 (US) or +1-201-689-8762
(international)
Please dial in at least 10 minutes prior to the start
time.
Live Audio Webcast and
Replay: www.wpcarey.com/announcement
W. P. Carey Inc.
Celebrating its 45th anniversary, W. P. Carey ranks among the
largest diversified net lease REITs with an enterprise value of
over $10 billion and a portfolio of
operationally-critical commercial real estate totaling 886
properties covering approximately 85 million square feet. For over
four decades, the Company has invested in high-quality
single-tenant industrial, warehouse, office and retail properties
subject to long-term leases with built-in rent escalators. Its
portfolio is located primarily in North
America and Northern and Western
Europe and is well-diversified by tenant, property type,
geographic location and tenant industry.
www.wpcarey.com
Cautionary Statement Concerning Forward-Looking
Statements
Certain of the matters discussed in this press release
constitute forward-looking statements within the meaning of the
Securities Act of 1933 and the Securities Exchange Act of 1934,
both as amended by the Private Securities Litigation Reform Act of
1995. The forward-looking statements include, among other things,
statements regarding the intent, belief or expectations of W. P.
Carey Inc. ("WPC") and can be identified by the use of words such
as "may," "will," "should," "would," "will be," "will continue,"
"will likely result," "believe," "project," "expect," "anticipate,"
"intend," "estimate" and other comparable terms. These
forward-looking statements include, but are not limited to,
statements regarding: the anticipated benefits of the merger,
including the statements made by Mr. Jason
Fox; our ability to close the proposed merger; the impact of
the proposed merger on our earnings and on our credit profile; the
strategic rational and transaction benefits; our ability to
refinance mortgage debt with unsecured bonds; capital markets; our
ability to sell shares under our "at-the-market" program and the
use of proceeds from that program; tenant credit quality; the
general economic outlook; our expected range of Adjusted funds from
operations, or AFFO, including the impact on AFFO as a result of
the proposed merger; our corporate strategy; our capital structure;
our portfolio lease terms; our international exposure and
acquisition volume; our expectations about tenant bankruptcies and
interest coverage; statements regarding estimated or future
economic performance and results, including our underlying
assumptions, occupancy rate, credit ratings, and possible new
acquisitions and dispositions; the outlook for the investment
programs that we manage, including their earnings, as well as
possible liquidity events for those programs; statements that we
make regarding our ability to remain qualified for taxation as a
real estate investment trust, or REIT; the impact of recently
issued accounting pronouncements, the Tax Cuts and Jobs Act in
the United States adopted in 2017,
and other regulatory activity, such as the General Data Protection
Regulation in the European Union or other data privacy initiatives;
the amount and timing of any future quarterly dividends; our
existing or future leverage and debt service obligations; our
estimated future growth; our projected assets under management; our
future capital expenditure levels; our future financing
transactions; and our plans to fund our future liquidity needs.
These statements are based on the current expectations of our
management. It is important to note that our actual results could
be materially different from those projected in such
forward-looking statements. There are a number of risks and
uncertainties that could cause actual results to differ materially
from these forward-looking statements. Other unknown or
unpredictable factors could also have material adverse effects on
our business, financial condition, liquidity, results of
operations, AFFO, and prospects. You should exercise caution in
relying on forward-looking statements as they involve known and
unknown risks, uncertainties, and other factors that may materially
affect our future results, performance, achievements, or
transactions. Information on factors that could impact actual
results and cause them to differ from what is anticipated in the
forward-looking statements contained herein is included in our
filings with the Securities and Exchange Commission, or the SEC
from time to time, including, but not limited to those described in
Item 1A. Risk Factors in our Annual Report on Form 10-K for the
year ended December 31, 2017, as
filed with the SEC on February 23,
2018. Moreover, because we operate in a very competitive and
rapidly changing environment, new risks are likely to emerge from
time to time. Given these risks and uncertainties, potential
investors are cautioned not to place undue reliance on these
forward-looking statements as a prediction of future results, which
speak only as of the date of this presentation, unless noted
otherwise. Except as required by federal securities laws and the
rules and regulations of the SEC, we do not undertake to revise or
update any forward-looking statements.
Additional Information and Where to Find It
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offering of securities shall be made except by means of a
prospectus meeting the requirements of the federal securities laws.
W. P. Carey intends to file a Registration Statement on Form S-4
and mail the Joint Proxy Statement/Prospectus and other relevant
documents to its security holders in connection with the proposed
Merger.
WE URGE INVESTORS TO READ THE JOINT PROXY
STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS FILED BY W.
P. CAREY AND CPA:17 IN CONNECTION WITH THE PROPOSED MERGER WHEN
THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT W. P. CAREY, CPA:17 AND THE PROPOSED MERGER.
INVESTORS ARE URGED TO READ THESE DOCUMENTS CAREFULLY AND IN THEIR
ENTIRETY.
Investors will be able to obtain these materials and other
documents filed with the SEC free of charge at the SEC's website
(http://www.sec.gov). In addition, these materials will also be
available free of charge by accessing W. P. Carey's website
(http://www.wpcarey.com) or by accessing CPA:17's website
(http://www.cpa17global.com). Investors may also read and copy any
reports, statements and other information filed by W. P. Carey or
CPA:17 with the SEC, at the SEC public reference room at 100 F
Street, N.E., Washington, D C.
20549. Please call the SEC at 1-800-SEC-0330 or visit the SEC's
website for further information on its public reference room.
Participants in the Proxy Solicitation
Information regarding W. P. Carey's directors and executive
officers is available in its proxy statement filed with the SEC by
W. P. Carey on April 03, 2018 in
connection with its 2018 annual meeting of stockholders, and
information regarding CPA:17's directors and executive officers is
available in its proxy statement filed with the SEC by CPA:17 on
April 20, 2018 in connection with its
2018 annual meeting of stockholders. Other information regarding
the participants in the proxy solicitation and a description of
their direct and indirect interests, by security holdings or
otherwise, will be contained in the Joint Proxy
Statement/Prospectus and other relevant materials filed with the
SEC when they become available.
Institutional Investors:
Peter Sands
W. P. Carey Inc.
212-492-1110
institutionalir@wpcarey.com
Individual Investors:
W. P. Carey Inc.
212-492-8920
ir@wpcarey.com
Press Contact:
Guy Lawrence
Ross & Lawrence
212-308-3333
gblawrence@rosslawpr.com
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SOURCE W. P. Carey Inc.