NorthStar REIT and NorthStar REIT II Shareholders Approve Merger
January 19, 2018 | James Sprow | Blue Vault
The stockholders of NorthStar Real Estate Income Trust, Inc. (“NorthStar I”) and NorthStar Real Estate Income II, Inc., (“NorthStar II”) voted to approve the mergers of NorthStar I and NorthStar II into Colony NorthStar Credit Real Estate, Inc. (“CLNC”) at special meetings on January 18. At the special meeting of NorthStar I stockholders, approximately 94% of the votes cast were voted in favor of the proposed merger. At the special meeting of NorthStar II stockholders, approximately 93% of the votes cast were voted in favor of the proposed merger.
The stockholders of NorthStar I also approved a charter amendment to permit a liquidating trust to liquidate the remaining assets of NorthStar I in connection with the merger.
The combination of NorthStar I and NorthStar II along with a portfolio of assets worth an estimated $1.6 billion contributed to CLNC by Colony NorthStar is expected to create a publicly traded REIT externally managed by Colony NorthStar that will have an estimated $5.2 billion in total assets and equity valued at $3.3 billion.
The combination is currently expected to close on or about January 31, 2018. As a result of the mergers, each outstanding share of NorthStar I common stock will be converted into the right to receive 0.3532 shares of CLNC Class A common stock and each outstanding share of NorthStar II Class A and Class T common stock will be converted into the right to receive 0.3511 shares of CLNC common stock. No fractional shares will be issued in connection with the mergers and the applicable NorthStar I and NorthStar II stockholders will receive cash in lieu of fractional shares.
It is currently expected that Colony NorthStar Credit Real Estate will pursue a listing, rather than an initial public offering. Subject to approval for listing from the New York Stock Exchange (the “NYSE”), it is expected that the common stock will be listed on the NYSE under the ticker symbol “CLNC” and will begin trading on or about February 1, 2018.
As of September 30, 2017, NorthStar I had total assets of $2.44 billion and an investment portfolio of operating real estate, debt and securities. The REIT’s offering closed in July, 2013, after raising $1.1 billion. Its Q3 2017 distribution was at the rate of 7.00% annualized, based upon the original offering price of $10.00 per share, and its most recent NAV per share was $9.92 as of December 31, 2016.
As of September 30, 2017, NorthStar II had total assets of $1.81 billion and an investment portfolio consisting of 24 properties, CRE loans, private equity and CMBS. The REIT’s offering closed in November, 2016, after raising $1.14 billion. Its Class A common stock distributions were at the rate of 7.00% annualized, based upon the original offering price of $10.00 per share, and its most recent NAV per share was $9.26 as of September 30, 2016.
Learn more about Colony NorthStar, Inc. on the Blue Vault Sponsor Focus page.
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