WINNIPEG, MB, March 1, 2022 /CNW/ - Artis Real Estate
Investment Trust ("Artis" or the "REIT") (TSX: AX.UN) announced
today the closing of the previously announced plan of arrangement
transaction (the "Arrangement"), pursuant to which all of the
issued and outstanding units of Cominar Real Estate Investment
Trust ("Cominar") were acquired for $11.75 per unit in cash by a consortium led by an
affiliate of Canderel Management Inc., and including Artis,
partnerships managed by Sandpiper Group, and FrontFour Capital
Group LLC.
"This is a milestone transaction in the implementation of our
Business Transformation Plan and is reflective of the nature of
investment that we are pursuing to build long-term value for our
unitholders," said Samir Manji,
President and Chief Executive Officer of Artis. "Since announcing
this transaction last October, our conviction in the intrinsic
value of Cominar's real estate portfolio and the corresponding
value creation we will achieve for our unitholders has only
strengthened. At the same time, through the active collaboration
we've had with our consortium partners, we have seen first-hand the
valuable contribution each of our partners bring to the
table."
Artis contributed $212.0 million
to the Arrangement, including $112.0
million to acquire common equity units (representing
approximately 32.64% of the total common equity units in the newly
formed entity) and $100.0 million to
acquire junior preferred units that carry a distribution rate of
18.0% per annum. As part of the consideration, Artis contributed
its existing Cominar units, which had a fair value of $13.4 million as at December 31, 2021. Sandpiper Group contributed
$56.0 million to the Arrangement,
representing 16.32% of the common equity, and Halcyon International
Limited, a company controlled by Steven
Joyce, contributed $20.0
million to the Arrangement, representing 5.83%. Together,
Artis, Sandpiper Group and Halcyon International Limited control
54.79% of the total common equity units in the newly formed
entity.
"This transaction, and other key initiatives completed last
year, align with the long-term vision and strategy announced last
March," said Ben Rodney, Chair of
the Artis Board of Trustees. "The ability to strengthen our balance
sheet and liquidity in a short period of time and then immediately
harness some of that liquidity to acquire a significant stake in a
portfolio, at a substantial discount to its intrinsic value, will
produce strong NAV growth for Artis and its unitholders. This also
validates the relationship Artis has with Sandpiper Group.
Sandpiper provided the underwriting for this investment, which they
had developed over several years, and it enabled Artis to move
swiftly and confidently in our decision. We are very pleased with
what we have achieved in our first year since presenting our new
vision and strategy and we look forward to working with our
management team in the execution of our 2022 plan."
Also under the Arrangement, certain of Cominar's office, retail
and industrial assets were acquired by other parties not part of
the consortium.
The Arrangement was originally announced on October 24, 2021, and was approved by Cominar's
unitholders at a special meeting held on December 21, 2021. A final order from the
Superior Court of Québec in respect of the Plan of Arrangement was
obtained on December 23, 2021.
On March 10, 2021, Artis announced
a new vision and strategy for the REIT – to build a best-in-class
asset management and investment platform focused on growing net
asset value per unit and distributions for investors through debt
repayment, return of capital and value investing in real estate. As
part of this strategy, Artis committed to deploying capital into
strategic investments in portfolio companies and concentrating its
ownership in the highest and best return opportunities in an effort
to maximize long-term value for unitholders.
Artis is a diversified Canadian real estate investment trust
with a portfolio of industrial, office and retail properties in
Canada and the United States. Artis' vision is to build a
best-in-class asset management and investment platform focused on
growing net asset value per unit and distributions for investors
through debt repayment, return of capital and value investing in
real estate.
Cautionary Statements
This press release contains forward-looking statements. For this
purpose, any statements contained herein that are not statements of
historical fact may be deemed to be forward-looking statements.
Without limiting the foregoing, the words "expects", "anticipates",
"intends", "estimates", "projects", "seeks", and similar
expressions or variations of such words and phrases that state that
certain actions, events or results ''may'', ''would'' or ''will''
occur or be achieved are intended to identify forward-looking
statements. Particularly, statements regarding the terms and
conditions of the Arrangement and Artis' participation therein, the
timing of the Arrangement, Artis' return of capital and value
investing strategies, building Artis into a best-in-class asset
management and investment platform focused on value investing in
real estate, the REIT's ability to execute its strategy, the REIT's
ability to maximize long-term value and anticipated returns are
forward-looking statements. Forward-looking statements are based on
a number of factors and assumptions which have been used to develop
such statements, but which may prove to be incorrect. Although
Artis believes that the forward-looking statements in this press
release are based on information and assumptions that are current,
reasonable and complete, these statements are by their nature
subject to a number of factors that could cause actual results to
differ materially from management's expectations and plans as set
forth in such forward-looking statements. For more information
on the risks, uncertainties and assumptions that could cause the
Artis' actual results to differ from current expectations, refer to
the section entitled "Risk Factors" of Artis' Annual Information
Form for the year ended December 31,
2020, as well as Artis' other public filings, available
at www.sedar.com. Artis cannot assure investors that actual
results will be consistent with any forward-looking statements and
Artis assumes no obligation to update or revise such
forward-looking statements to reflect actual events or new
circumstances. All forward-looking statements contained in this
press release are qualified by this cautionary statement.
SOURCE Artis Real Estate Investment Trust