Brookfield Office Properties Fund Enters a Merger Agreement with MPG Office Trust

Brookfield Office Properties Fund Enters a Merger Agreement with MPG Office Trust

A newly formed fund controlled by Brookfield Office Properties Inc. entered into a definitive agreement to acquire MPG Office Trust Inc. Under the terms of the agreement, MPG shareholders will receive $3.15 per common share in cash, representing a 21 percent premium to the company’s closing price of $2.60 per share on Apr. 24. Brookfield has also entered into a guarantee with respect to obligations of its affiliates under the merger agreement. The agreement and the transactions contemplated thereby have been unanimously approved by the company’s board of directors.

The agreement also provides that a Brookfield subsidiary will commence a tender offer to purchase all of MPG’s outstanding preferred shares for $25.00 per share in cash, without interest. Brookfield is expected to commence the tender offer in early May. If more than 66.6 percent of the outstanding preferred shares are tendered, then Brookfield will have the right to convert all of the untendered preferred shares at the price in cash offered in the tender offer, without interest.

The merger is scheduled to close in the third quarter of 2013, subject to approval by MPG’s common stockholders and receipt of consents from the company’s lenders.

“Following a lengthy and exhaustive search, we have found a strategic buyer who has the capital and the market presence to appreciate the potential long-term value of our assets,” said MPG President and CEO David Weinstein in a statement. “This transaction potentially offers both our common and preferred shareholders a liquidity event that would remain uncertain if the company were to continue on as an independent entity.”

The Eastdil Secured group of Wells Fargo Securities LLC and BofA Merrill Lynch served as financial advisors to MPG. Latham & Watkins LLP and Venable LLP served as legal advisors to the company. Fried, Frank, Harris, Shriver & Jacobson LLP and Goodwin Procter LLP were legal advisors to Brookfield.


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