AR Capital’s Healthcare Trust Takes Additional Strategic Review Steps, Amends Share Repurchase Plan
The board of directors of Healthcare Trust Inc., a publicly registered, non-traded real estate investment trust sponsored by AR Global, the successor business to AR Capital, announced that its special strategic review committee retained Morgan Stanley & Co. LLC and KeyBanc Capital Markets as financial advisors, with Morgan Stanley as lead advisor.
The company previously announced that the board retained Gibson, Dunn & Crutcher LLP as special legal counsel to assist with the strategic review process.
As reported by the DI Wire, AR Global is seeking to consolidate seven real estate investment trusts with nearly $10.5 billion in assets.
American Finance Trust is reportedly seeking to buy Healthcare Trust, Realty Finance Trust, American Realty Capital – Retail Centers of America, and American Realty Capital Healthcare Trust III, while publicly traded Global Net Lease (NYSE: GNL) would acquire American Realty Capital Global Trust II. All of the REITs are externally advised by AR Global-controlled entities.
Due to the strategic review, the board has also amended the company’s share repurchase program that became effective February 28, 2016.
The program is being amended to eliminate the first and second semester repurchase provisions. Previously, stockholders could request repurchases of the company’s common stock on a semiannual basis (each six-month period ending June 30 or December 31).
With the amendment, stockholders can now submit repurchase requests through December 31, 2016. Repurchases will continue to be limited to a maximum of 5 percent of the weighted average number of shares of common stock outstanding during the previous fiscal year. Payment is expected to be made in January 2017.
Other AR Global non-traded REITs involved in the undisclosed roll-up took similar measures and amended their share repurchase plans as well, according to filings with the Securities and Exchange Commission. These include, American Finance Trust, American Realty Capital – Retail Centers of America, American Realty Capital Global Trust II, and American Realty Capital Healthcare Trust III.
Healthcare Trust noted that no decision has been made to enter into any transaction at this time. The REIT said that it does not intend to comment on or disclose developments regarding the strategic review process unless it deems further disclosure is appropriate or required.
Healthcare Trust invests in senior housing and healthcare real estate in the United States. The company owns 166 properties totaling 8.5 million square feet located in 29 states. The company commenced its initial public offering in February 2013 and has raised $2.2 billion in investor equity since that time. The REIT closed its offering in November 2014, and recently declared a per share net asset value of $22.27. Shares were originally priced at $25.00 each.
AR Capital, the REIT’s former sponsor, and Realty Capital Securities, its former dealer manager, were involved in a series of scandals that eventually led to the termination of all AR Capital-sponsored investment programs and an agreement by RCS to terminate its business.
