CNL Healthcare Announces Result of MacKenzie Tender Offer
December 18, 2018 | James Sprow | Blue Vault
MacKenzie Realty Capital, Inc. made a tender offer to purchase up to 8,750,000 shares of common stock in CNL Healthcare Properties, Inc. at a purchase price equal to $7.75 per share, upon the terms and subject to the conditions set forth in the Offer to Purchase dated October 22, 2018 and the related Assignment Form.
The offer resulted in the tender by shareholders, and acceptance for payment by MacKenzie Realty Capital, of a total of 101,314.033 shares. Following the purchase of all the tendered shares, the purchasers will own an aggregate of approximately 101,314.033 shares, or approximately 0.06% of the total outstanding shares.
On October 26, 2018, the board of directors of CNL Healthcare recommended that stockholders reject the MacKenzie Realty Capital offer. The first factor mentioned in the board’s recommendation stated:
“The MRC Offer of $7.75 per share represents a price that is 25% less than the $10.32 estimated NAV per share of our common stock as of December 31, 2017, which was determined by our Board with the assistance of an independent third-party evaluation firm. While there can be no assurance of any liquidity transactions in the near or medium-term or of the results of any such transactions, the Board believes that the steps the Company is taking to explore strategic alternatives provide an appropriate platform and opportunity to realize the maximum value of the Company’s real estate portfolio for the benefit of all stockholders.”
As of September 30, 2018, CNL Healthcare’s investment portfolio consisted of interests in 142 properties, including 72 seniors housing properties, 53 MOBs, 12 post-acute care facilities and five acute care hospitals. Of the properties held at September 30, 2018, five of 72 seniors housing properties were owned through an unconsolidated joint venture and one was comprised of unimproved land.
In June 2018, the REIT suspended its distribution reinvestment plan, effective July 11, 2018. As a result of the suspension, stockholders who were participants in the distribution reinvestment plan began to receive cash distributions instead of additional shares of common stock beginning with the third quarter of 2018.
Based upon the original $10.00 share price the REIT’s annualized distribution yield was 4.66% for Q3 2018.
Sources: SEC, Blue Vault
Learn more about CNL Financial Group on the Blue Vault Sponsor Focus page
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