American Realty Capital Properties Announces Intention To Close CapLease Merger Earlier Than Expected In Third Quarter Of 2013 In Light Of Expiration Of CapLease's 40-Day "Go Shop" Period
NEW YORK, July 8, 2013 /PRNewswire/ -- American Realty Capital Properties, Inc. ("ARCP" or the "Company") (NASDAQ: ARCP) reaffirmed today its intention to close its previously announced merger with CapLease, Inc. ("CapLease") (NYSE: LSE). Following CapLease's announcement of the expiration of its 40-day "go shop" period without receipt of any alternative proposals, the Company expects to close the transaction in the third quarter of 2013. CapLease's recent filing of its preliminary proxy statement in connection with its special meeting, at which CapLease stockholders will vote whether to approve the merger, and the expiration of the "go shop" period, provide ARCP with a clear timetable for the closing of the CapLease acquisition.
ARCP's acquisition of CapLease is expected to include the addition of CapLease's highly experienced management team. CapLease's professionals would bring in-depth experience and knowledge related to the office and industrial sectors as well as "build-to-suit" opportunities. These skill sets would greatly assist ARCP in continuing to broaden and further diversify its single tenant net lease real estate portfolio. The addition of CapLease's management team would also help accelerate the Company's implementation of its previously announced intent to internalize its own management in order to further reduce operating costs and potentially improve the Company's AFFO multiple.The expiration of CapLease's "go shop" period and the recent filing of its preliminary proxy statement pave the way for another significant step toward ARCP's deliberate yet rapid transformation into the leading net lease REIT with an expected enterprise value in excess of $10 billion by the end of 2013. The Company's growth has been fueled by organic acquisitions and accretive strategic additions, both corporate and in portfolio. In light of this growth, on July 1, 2013, in connection with its entry into a merger agreement with American Realty Capital Trust IV, Inc. ("ARCT IV"), the Company's board of directors authorized, and the Company declared, that its previously announced seventh consecutive quarterly increase of its annualized dividend from $0.91 to $0.94 per share would become effective on the earlier to occur of the closing of the Company's merger with ARCT IV and its merger with CapLease. Nicholas S. Schorsch, Chairman and Chief Executive Officer of ARCP commented, "In light of the expiration of the 'go shop' period and recent filing of CapLease's preliminary proxy statement, we are reaffirming our intention to close the CapLease merger in the third quarter of 2013, representing another significant milestone in this transformative year for ARCP. With the recent success demonstrated by our $774 million acquisition of a high-quality portfolio from GE Capital, we have closed over $1.14 billion of portfolio acquisitions year to date. Moreover, we are confident that we can efficiently close both the ARCT IV and CapLease transactions before the end of the third quarter. With CapLease and ARCT IV, both of which acquisitions will prove accretive to our earnings, we will grow our enterprise value to over $10 billion. This substantial growth in assets will prompt us and our board of directors to review closely the previously announced internalization of management." About ARCP ARCP is a publicly traded Maryland corporation listed on The NASDAQ Global Select Market that qualified as a real estate investment trust ("REIT") for U.S. federal income tax purposes beginning in the taxable year ended December 31, 2011, focused on acquiring and owning single tenant freestanding commercial properties subject to net leases with high credit quality tenants. Additional information about the ARCP can be found on its website at www.arcpreit.com . ARCP may disseminate important information regarding the Company and its operations, including financial information, through social media platforms such as Twitter, Facebook and LinkedIn. Funds from Operations and Adjusted Funds from Operations ARCP considers funds from operations ("FFO") and AFFO, which is FFO as adjusted to exclude acquisition-related fees and expenses, amortization of above-market lease assets and liabilities, amortization of deferred financing costs, straight-line rent, non-cash mark-to-market adjustments, amortization of restricted stock, non-cash compensation and non-recurring gains and losses useful indicators of the performance of a REIT. Because FFO calculations exclude such factors as depreciation and amortization of real estate assets and gains or losses from sales of operating real estate assets (which can vary among owners of identical assets in similar conditions based on historical cost accounting and useful-life estimates), they facilitate comparisons of operating performance between periods and between other REITs in ARCP's peer groups. Accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered the presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves.
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