LOUISVILLE, KY -- (Marketwire) -- 12/27/12 -- (NYSE MKT: NLP) -- NTS Realty Holdings Limited Partnership ("NTS" or the "Company") announced today that it has entered into a definitive merger agreement with entities created and controlled by J.D. Nichols, the founder and Chairman of NTS, and Brian F. Lavin, the President and CEO of NTS. Upon consummation of the merger, all of the outstanding partnership units of NTS not owned by Messrs. Nichols and Lavin and their affiliates would convert into $7.50 per unit in cash.
The transaction results from extensive negotiations between Messrs. Nichols and Lavin and a Special Committee of independent directors of NTS Realty Capital, Inc., the managing general partner of NTS, formed September 12, 2012 in response to a "going private" proposal made on August 31, 2012 by Messrs. Nichols and Lavin to acquire all publicly held units of NTS for $5.25 per unit. The final price of $7.50 per unit represents a 43% premium above their original $5.25 proposal and a 144% premium above the closing price of $3.07 for NTS units on the last trading day prior to the publication of Messrs. Nichols and Lavin's August 31 proposal.
The merger is conditioned on a "majority of the minority" voting provision, which requires approval by holders of a majority of NTS outstanding units not held by the purchasers. The transaction is also subject to other customary closing conditions, including the receipt of financing by the purchasers that is sufficient to pay the merger consideration and related expenses of the transaction. The purchasers have obtained a debt commitment letter from an unaffiliated financing source on commercially standard terms. The merger and related transactions are expected to be completed in the first half of 2013. However, there can be no assurance that the merger agreement will be approved by the unitholders, that the purchasers will receive sufficient financing or that the merger will be consummated on the terms described herein or at all.
The Board of Directors of the general partner of NTS, acting upon the unanimous recommendation of the Special Committee, unanimously approved the merger agreement and has recommended that unitholders of NTS vote to approve the merger. After careful consideration and a thorough review with its independent advisors, the Special Committee determined that the transaction is in the best interests of the unitholders of NTS (other than the purchasers). The Special Committee's independent financial advisor has delivered a written opinion to the effect that as of December 27, the merger consideration is fair from a financial point of view to the unitholders of NTS (other than the purchasers). This determination by the Special Committee's financial advisor was based on, and is subject to, assumptions and limitations set forth in the written opinion.
Messrs. Nichols and Lavin received legal advice from Fore, Miller & Schwartz.
The Special Committee received financial advice from Centerboard Securities, LLC and legal advice from Stites & Harbison PLLC.
NTS received legal advice from Shefsky & Froelich Ltd.
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