Granite Real Estate Investment Trust and Granite REIT Inc. Announce Court Approval of Proposed Unwind of Stapled Unit Structure
Granite Real Estate Investment Trust (Granite REIT) and Granite REIT Inc. (Granite GP) have received final court approval from the Supreme Court of British Columbia for their proposed plan to simplify their capital structure. This plan involves replacing the current stapled unit structure with a conventional REIT trust unit structure. The plan was approved by Granite's unitholders during their Annual and Special Meetings on June 6, 2024. Completion of the arrangement is expected in the fourth quarter of fiscal 2024, pending satisfaction or waiver of remaining conditions.
- Final court approval received for the capital structure simplification plan.
- Unitholder approval obtained during the Annual and Special Meetings on June 6, 2024.
- Expected completion of the arrangement in the fourth quarter of fiscal 2024.
- Completion of the arrangement is still subject to satisfaction or waiver of remaining conditions.
- Potential delays in the fourth quarter of fiscal 2024 if conditions are not met.
Insights
Granite's move to simplify its capital structure by unwinding the stapled unit structure and adopting a conventional REIT trust unit structure is significant. This decision could potentially impact the way investors perceive the company's financial health and stability.
From a financial perspective, a simpler capital structure can make Granite more attractive to a broader range of investors, particularly those who prefer straightforward, easily understandable investment vehicles. A conventional REIT structure typically offers greater transparency and liquidity, which can lead to increased investor confidence and potentially higher demand for Granite's units.
In the short term, there might be some volatility as the market adjusts to the new structure. However, in the long term, the simplified structure is likely to reduce administrative costs and complexities. This could lead to higher operating efficiency and better alignment with investor interests.
It's important to monitor how this restructuring will affect Granite's dividend policy and payout ratios. Investors should also consider how the new structure aligns with industry norms and whether it positions Granite more competitively within the REIT sector.
The approval by the Supreme Court of British Columbia is a critical step in Granite's restructuring process. Legal oversight ensures that the arrangement complies with regulatory requirements and protects the interests of various stakeholders, including unitholders.
This judicial approval signals that Granite has met all necessary legal standards, which can be seen as a positive indicator of the company's governance and compliance practices. For investors, this reduces the risk of legal challenges or disputes that could arise from the restructuring process.
Furthermore, the court's involvement adds a layer of credibility and security to the transaction, likely making it more palatable for investors who might have been cautious about the change. Ensuring that all legal conditions are met before finalizing the arrangement also helps to minimize any potential disruptions or delays, thereby providing a clearer path forward for the company and its investors.
The final order was obtained following Granite’s Annual and Special Meetings of Stapled Unitholders held on June 6, 2024, where the Arrangement was approved by Granite unitholders. Subject to satisfaction or waiver of certain other closing conditions, Granite expects the Arrangement to be completed in the fourth quarter of fiscal 2024.
ABOUT GRANITE
Granite is a Canadian-based REIT engaged in the acquisition, development, ownership and management of logistics, warehouse and industrial properties in
OTHER INFORMATION
Copies of financial data and other publicly filed documents about Granite are available through the internet on the Canadian Securities Administrators’ System for Electronic Data Analysis and Retrieval+ (SEDAR+) which can be accessed at www.sedarplus.ca and on the United States Securities and Exchange Commission’s Electronic Data Gathering, Analysis and Retrieval System (EDGAR) which can be accessed at www.sec.gov.
For further information, please see our website at www.granitereit.com or contact Teresa Neto, Chief Financial Officer, at 647-925-7560 or Andrea Sanelli, Associate Director, Legal & Investor Services, at 647-925-7504.
FORWARD-LOOKING STATEMENTS
This press release may contain statements that, to the extent they are not recitations of historical fact, constitute “forward-looking statements” or “forward-looking information” within the meaning of applicable securities legislation, including the United States Securities Act of 1933, as amended, the United States Securities Exchange Act of 1934, as amended, and applicable Canadian securities legislation. Forward-looking statements and forward-looking information may include, among others, statements regarding the Arrangement, Granite’s intention to implement the Arrangement, and Granite’s ability to obtain the required approvals or satisfy or waive conditions to implementing the Arrangement, or the expectations or assumptions underlying any of the foregoing. Words such as “outlook”, “may”, “would”, “could”, “should”, “will”, “likely”, “expect”, “anticipate”, “believe”, “intend”, “plan”, “forecast”, “project”, “estimate”, “seek” and similar expressions are used to identify forward-looking statements and forward-looking information. Forward-looking statements and forward-looking information should not be read as guarantees of future events, performance or results and will not necessarily be accurate indications of whether or the times at or by which such future performance will be achieved. Undue reliance should not be placed on such statements. Granite cautions that the timing or completion of the Arrangement cannot be predicted with certainty, there can be no assurance at this time that all required or desirable approvals and consents to effect the Arrangement will be obtained in a timely manner. Forward-looking statements and forward-looking information are based on information available at the time and/or management’s good faith assumptions and analyses made in light of Granite’s perception of historical trends, current conditions and expected future developments, as well as other factors Granite believes are appropriate in the circumstances. Forward-looking statements and forward-looking information are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond Granite’s control, that could cause actual events or results to differ materially from such forward-looking statements and forward-looking information. Important factors that could cause such differences include, but are not limited to, the risk of Granite being unable to obtain required approvals or to satisfy or waive conditions to implementing the Arrangement and risks disclosed in the Granite’s Management Information Circular/Proxy Statement dated April 10, 2024. Forward-looking statements and forward-looking information speak only as of the date the statements and information were made and unless otherwise required by applicable securities laws, Granite expressly disclaims any intention and undertakes no obligation to update or revise any forward-looking statements or forward-looking information contained in this press release to reflect subsequent information, events or circumstances or otherwise.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240610836831/en/
Teresa Neto
Chief Financial Officer
647-925-7560
or
Andrea Sanelli
Associate Director, Legal & Investor Services
647-925-7504
Source: Granite Real Estate Investment Trust
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