Associated Estates Sells to Brookfield Asset Management in a Transaction Valued at $2.5 Billion

Associated Estates Sells to Brookfield Asset Management in a Transaction Valued at $2.5 Billion

CLEVELAND, OH - Associated Estates Realty Corporation announced its Board of Directors has unanimously approved a definitive merger agreement under which a real estate fund managed by Brookfield Asset Management will acquire all outstanding shares of common stock of Associated Estates for $28.75 per share in cash. The transaction is valued at approximately $2.5 billion including the assumption of debt.

Brookfield is a global alternative asset manager with more than $200 billion in assets under management. Brookfield has over a 100-year history of owning and operating assets with a focus on property, renewable energy, infrastructure and private equity. Brookfield Property Group, Brookfield's largest investment platform, comprises of sector-specific portfolios in the multifamily, office, retail, industrial, and hotel sectors. 

Jeffrey I. Friedman, Chairman and Chief Executive Officer, said, "In December 2014, we announced that our Board was undertaking a thorough business review with the assistance of our financial advisor.  After analyzing the Company's strategy, assets and other opportunities, including running a process involving a number of qualified potential buyers, the Board unanimously determined that this transaction is the best course of action to maximize shareholder value.  We are pleased that Brookfield recognizes the value inherent in our income producing properties, development projects and the platform we have built.  We are also excited that this transaction will deliver compelling, immediate and certain value to all Associated Estates shareholders."

Completion of the transaction is contingent upon customary closing conditions. The Company will convene a special meeting to seek the approval of Associated Estates shareholders, and the annual meeting previously scheduled for May 22, 2015 has been postponed indefinitely.  The transaction is not contingent on receipt of financing by Brookfield.

Closing is expected to occur in the second half of 2015.  Associated Estates' headquarters will remain in Richmond Heights, Ohio.

Associated Estates will release financial results for its first quarter 2015 on Friday, May 1, 2015. In light of today's announcement, the Company will not hold a conference call to discuss its first quarter financial results.

The Company intends to pay the previously announced common stock dividend of $0.21 per share on May 1, 2015 to shareholders of record as of April 15, 2015. The Company does not expect to pay additional dividends prior to the closing of the merger.

Citigroup acted as exclusive financial advisor to Associated Estates, and Jones Day is acting as Associated Estates' legal advisor.

Associated Estates is a real estate investment trust and a member of the S&P 600, Russell 2000, and MSCI US REIT Indices. The Company is headquartered in Richmond Heights, Ohio. Associated Estates' portfolio consists of 56 apartment communities containing 15,004 units located in 10 states, which include two committed acquisitions with 681 units that are being managed during lease-up and five apartment communities with 1,446 units in various stages of active development.

Source: Associated Estates Realty Corporation / #Apartments #Multifamily

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