Blackwells Capital LLC has made an all-cash bid to acquire Monmouth Real Estate Investment Corporation for $18 per share. The transaction is valued at approximately $3.8 billion, including the assumption of debt. Founded in 1968, Monmouth is a publicly traded REIT.
NEW YORK, December 21, 2020 – Blackwells Capital LLC (together with its affiliates “Blackwells”), an alternative investment management firm that is one of the largest owners of Monmouth Real Estate Investment Corporation (NYSE: MNR) (“Monmouth” or the “Company”), announced today that on December 18, 2020, it submitted an offer letter to the Company’s Board of Directors (the “Board”) outlining an all-cash offer to acquire Monmouth for $18.00 per share.
Blackwells’ offer represents a 21.6% premium to the unaffected share price as of December 1, 2020 (at which time Blackwells privately submitted its first all-cash offer to the Chairman of the Board, Eugene Landy), and exceeds the unaffected three-month and six-month VWAPs by 23.8% and 24.8%, respectively. The all-cash transaction is valued at approximately $3.8 billion, including the assumption of debt.
Jason Aintabi, Chief Investment Officer of Blackwells, said, “As a public company, Monmouth has significantly underperformed comparable industrial REITs over the last five years, further exacerbated by the stock’s lack of liquidity. Blackwells’ cash offer provides shareholders immediate liquidity at a 17% premium above consensus net asset value – though the stock has long traded at a discount to it. Our offer also represents a premium to unaffected price well above the average premium for completed REIT deals over the last five years.”
Added Aintabi, “After we privately made our first offer on December 1, I had a constructive dialog with the Company’s CEO Michael Landy, who expressed enthusiasm and a desire to engage. Soon thereafter, we received a puzzling follow-up letter from Michael’s father, Chairman Eugene Landy, indicating that on second thought Monmouth would not engage with us, because exploring our offer would ‘not be in the best interests of the company.’ For myriad and tangible reasons, Monmouth in its current state, does not belong in the public markets. Pursuing our offer is the best way to maximize value for all Monmouth shareholders.”
Blackwells believes that a Special Committee of the Board, excluding Landy family members, Landy family affiliates, and those directors affiliated with UMH Properties, Inc., should be formed to objectively review the new Blackwells offer.
Blackwells is now making its offer public, to ensure all Monmouth shareholders have equal access to this information, in light of unusual trading volumes and share price dynamics since the submission of our first offer privately to the Company.