The board of Griffin Capital Essential Asset REIT Inc., a publicly registered non-traded real estate investment trust, has recommended that the company’s Class E shareholders reject the recent unsolicited tender offer made by CMG Partners LLC and its affiliates.
According to a letter to shareholders filed with the Securities and Exchange Commission, CMG is offering to purchase up to 400,000 Class E shares for $4.08 each, approximately 54 percent less than the shares’ most recent net asset value of $8.97, as of December 31, 2020.
The board believes that the tender offer is not in the best interest of shareholders and represents an opportunistic attempt by CMG to generate a profit by purchasing the shares at a discounted price.
“The board will continue to consider the liquidity available to [Griffin Capital Essential Asset REIT] Class E stockholders going forward…,” the letter stated. “It is possible that in the future additional liquidity will be made available…, though we can make no assurances as to whether that will happen, or the timing or terms of any such liquidity and whether any such liquidity will be available at a price in excess of the CMG offer price.”
Griffin Capital Essential Asset REIT is a self-managed REIT with a portfolio consisting primarily of single tenant business essential properties throughout the United States. The company’s portfolio consists of 123 properties with a total asset value of $5.8 billion, following the recent stock-for-stock merger transaction with Cole Office & Industrial REIT Inc.