CALGARY, Alberta, March 23, 2020 (GLOBE NEWSWIRE) — Northview Apartment Real Estate Investment Trust (âNorthviewâ or the âREITâ) (TSX:NVU.UN) today announced the expiration of the 30-day go-shop period (the âGo-Shop Periodâ) provided for in the arrangement agreement dated February 19, 2020 (the âArrangement Agreementâ) among the REIT, affiliates of Starlight Group Property Holdings Inc. (âStarlightâ) and KingSett Capital Inc. (âKingSettâ) (collectively, the âPurchasersâ) pursuant to which the Purchasers will acquire Northview, and the holders of Northviewâs outstanding trust units (âUnitsâ) (other than Starlightâs interest in the REIT which will be rolled into the acquiring entities) will receive $36.25 per Unit in cash (the âTransactionâ).
During the Go-Shop Period, Northview was permitted to actively solicit, evaluate and enter into negotiations with third parties that expressed an interest in acquiring Northview. Scotiabank, Northviewâs financial advisor, contacted 54 potential buyers. Two of the potential buyers entered into confidentiality agreements with Northview and were granted access to non-public information about Northview. Northview did not receive a superior proposal during the Go-Shop Period and the Board of Trustees of the REIT (the âBoardâ) did not determine that either of the two potential buyers that entered into confidentiality agreements with Northview had a reasonable prospect of making an acquisition proposal within the next 15 days.
In addition, Northview has waived existing standstill arrangements which bind Starlight and KingSett, effective immediately, so that Starlight, KingSett and their affiliates will be permitted to purchase Units of the REIT in the market prior to closing of the Transaction, provided that the number of Units, together with the existing Units owned by Starlight, does not exceed 19.9% of the outstanding Units of the REIT. Currently, Starlight and its affiliates beneficially own approximately 9,042,000 Units, representing approximately 13% of the outstanding Units.
The Transaction is structured as a statutory plan of arrangement under the Alberta Business Corporations Act. Completion of the Transaction requires approval of at least 66 2/3% of the votes cast by unitholders and holders of special voting units, as well as the approval by a simple majority of votes cast by disinterested unitholders and holders of special voting units, excluding Starlight, its affiliates and any other unitholders required to be excluded under Multilateral Instrument 61-101 â Protection of Minority Security Holders in Special Transactions at a special meeting of Northview. The place and time of the special meeting will be announced at a later date and Northview will issue a proxy circular, including voting instructions in due course.
The Transaction is also subject to the approval of the Alberta Court of Queenâs Bench, regulatory approvals, consents and approvals from Canada Mortgage and Housing Corporation (âCMHCâ) and certain of Northviewâs lenders and the satisfaction of other customary closing conditions.
Northview is one of Canada’s largest publicly traded multi-family REITs with a portfolio of approximately 27,000 residential suites and 1.2 million square feet of commercial space in more than 60 markets across eight provinces and two territories. Northview’s well-diversified portfolio includes markets characterized by expanding populations and growing economies, which provides Northview the means to deliver stable and growing profitability and distributions to Unitholders of Northview over time. Northview currently trades on the TSX under the ticker symbol: NVU.UN. Additional information concerning Northview is available at www.sedar.com or www.northviewreit.com.
CAUTIONARY AND FORWARD-LOOKING STATEMENTS
Certain statements in this news release constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements generally can be identified by the use of terms and phrases such as âwillâ, âsubject toâ, and similar terms and phrases, including references to assumptions and limitations. Some of the specific forward-looking statements in this news release include, but are not limited to, statements with respect to: the Transaction and the terms thereof; the purchase of Units by Starlight, KingSett or their affiliates in the market prior to closing of the Transaction; the place and time of the special meeting and the date an information circular will be issued; and regulatory, court, unitholder, CMHC and lender approvals. There can be no assurance that the proposed Transaction will be completed or that it will be completed on the terms and conditions contemplated in this news release. The proposed Transaction could be modified, restructured or terminated in accordance with its terms.
Forward-looking statements are based on information available at the time they are made, underlying estimates and assumptions made by management and management’s good faith belief with respect to future events, performance and results. Such assumptions include, without limitation, expectations and assumptions concerning the market price of the Units, the anticipated benefits of the Transaction to unitholders, the receipt in a timely manner of regulatory, court, unitholder, CMHC and lender approvals for the Transaction, and the availability of cash flow from operations to meet monthly distributions.
Forward-looking statements involve known and unknown risks, uncertainties and other factors, some of which are beyond Northviewâs control, which may cause actual events, results or performance to be materially different from the events, results, or performance expressed in such forward-looking statements. Such risks and uncertainties include, but are not limited to, general economic, market and business conditions in Canada and globally, governmental and regulatory requirements and actions by governmental authorities, risks associated with investment in and development of multi-family and commercial real estate, competition in the real estate industry, financing and refinancing risks, changes in economic conditions, changes in interest rates, changes in taxation rules, reliance on key personnel and potential diversion of management time on the Transaction, environmental matters, tenant risks, fluctuations in commodity prices and other risk factors more particularly described in the REITâs most recent Annual Information Form available on SEDAR at www.sedar.com. The anticipated timeline for completion of the Transaction may change for a number of reasons, including the inability to secure necessary regulatory, court, unitholder, CMHC, lender or other approvals in the time assumed, third party litigation or the need for additional time to satisfy the conditions to the completion of the Transaction. Additional risks and uncertainties not presently known to Northview or that Northview currently believes to be less significant may also adversely affect the REIT.
Readers are cautioned not to place undue importance on forward-looking statements. Northview disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required under applicable securities laws.
Northview Apartment Real Estate Investment Trust
Mr. Todd Cook
President and Chief Executive Officer
Mr. Travis Beatty
Chief Financial Officer
Longview Communications & Public Affairs