Apple REIT Ten Urges Shareholders to Reject Mackenzie Tender Offer
The board of Apple REIT Ten, a non-traded real estate investment trust, is urging its shareholders to reject the tender offer made by MacKenzie Realty Capital Inc., a non-traded business development company, believing that it is not in the best interests of its shareholders.
As reported by The DI Wire, MacKenzie issued a tender offer for up to 1 million shares of Apple Ten common stock for $9.18 per share. The offer, which constitutes 1.13 percent of the outstanding shares, expires on June 14th
.In a letter to shareholders, Apple Ten chairman and chief executive officer, Glade Knight said, “We believe this offer is meant to take advantage of you and buy your shares at an unreasonably low price in order to make a profit and, as a result, deprive you of the potential value of your investment.”
Last month, Apple Ten and Apple Hospitality REIT Inc. (NYSE: APLE) announced a $1.3 billion merger agreement that is expected to close in the third quarter of 2016. If approved, Apple Ten shareholders are expected to receive $1 and 0.522 shares of Apple Hospitality REIT for each share of Apple Ten. Yesterday, Apple Hospitality REIT closed at $19.02 per share, which would be the equivalent of $10.93 per share of Apple Ten stock.
MacKenzie currently owns 52,384.40 shares of Apple Ten REIT or 0.06 percent of those outstanding. It noted that the current price is the highest it has offered for shares of the company and is nearly 75 percent higher than its last offer.
Apple REIT Ten Inc. owns a portfolio of 55 hotels with a total of 7,056 guestrooms in 17 states. The company recently announced an estimated value of $11.10 per share of its common stock, as of December 31, 2015.
