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Blackstone Real Estate Partners X and Blackstone Real Estate Income Trust, Inc. have completed the privatization of Tricon Residential Inc. for a total equity transaction value of $3.5 billion. Tricon remains committed to developing new single-family homes and apartments in the U.S. and Canada, with plans to invest $1 billion in capital projects. The partnership aims to enhance the quality of existing homes and provide affordable housing. The transaction involves a cash offer of $11.25 per Common Share. Blackstone will maintain an 11.6% ownership stake post-closing. The Common Shares are expected to be de-listed from NYSE and TSX on May 2, 2024, with Tricon ceasing to be a reporting issuer. Detailed information on the Transaction is available in the Circular and on SEDAR+ and SEC websites.
Blackstone Real Estate Partners X e Blackstone Real Estate Income Trust, Inc. hanno completato la privatizzazione di Tricon Residential Inc., con un valore totale dell'operazione di 3,5 miliardi di dollari. Tricon continua a impegnarsi nello sviluppo di nuove case unifamiliari e appartamenti negli Stati Uniti e in Canada, pianificando investimenti per 1 miliardo di dollari in progetti di capitale. La partnership punta a migliorare la qualità delle abitazioni esistenti e a fornire alloggi accessibili. L'operazione include un'offerta in contanti di 11,25 dollari per ogni Azione Ordinaria. Blackstone manterrà una quota di proprietà del 11,6% dopo la chiusura. Si prevede che le Azioni Ordinarie saranno ritirate dalla quotazione alla NYSE e alla TSX il 2 maggio 2024, con Tricon che cesserà di essere un emittente di relazioni. Informazioni dettagliate sulla transazione sono disponibili nel Circular e sui siti web di SEDAR+ e SEC.
Blackstone Real Estate Partners X y Blackstone Real Estate Income Trust, Inc. han completado la privatización de Tricon Residential Inc. por un valor total de transacción de $3.5 mil millones. Tricon sigue comprometido con el desarrollo de nuevas viviendas unifamiliares y apartamentos en EE. UU. y Canadá, con planes de invertir $1 mil millones en proyectos de capital. La asociación tiene como objetivo mejorar la calidad de las viviendas existentes y proporcionar viviendas asequibles. La transacción incluye una oferta en efectivo de $11.25 por Cada Acción Común. Blackstone mantendrá una participación del 11.6% después del cierre. Se espera que las Acciones Comunes sean retiradas de la lista en la NYSE y la TSX el 2 de mayo de 2024, y Tricon dejará de ser un emisor que informa. Información detallada sobre la Transacción está disponible en el Circular y en los sitios web de SEDAR+ y SEC.
블랙스톤 부동산 파트너스 X와 블랙스톤 부동산 인COME 트러스트, Inc.가 트라이콘 주식회사의 사유화를 완료하여 총 자산 거래 가치는 35억 달러에 달합니다. 트라이콘은 미국과 캐나다에서 새로운 단독주택 및 아파트 개발에 계속 전념하며, 자본 프로젝트에 10억 달러를 투자할 계획입니다. 파트너십은 기존 주택의 품질을 개선하고 저렴한 주택을 제공하는 것을 목표로 합니다. 거래에는 주당 11.25달러의 현금 제안이 포함되어 있습니다. 블랙스톤은 거래 종료 후 11.6%의 소유 지분을 유지할 것입니다. 보통주는 2024년 5월 2일에 NYSE와 TSX에서 상장 폐지될 예정이며 트라이콘은 보고 발행인 자격을 상실할 것입니다. 거래에 대한 자세한 정보는 순환문과 SEDAR+ 및 SEC 웹사이트에서 확인할 수 있습니다.
Blackstone Real Estate Partners X et Blackstone Real Estate Income Trust, Inc. ont finalisé la privatisation de Tricon Residential Inc. pour une valeur totale de transaction de 3,5 milliards de dollars. Tricon reste engagé dans le développement de nouvelles maisons unifamiliales et appartements aux États-Unis et au Canada, avec des plans d'investir 1 milliard de dollars dans des projets de capitaux. Le partenariat vise à améliorer la qualité des logements existants et à fournir des logements abordables. La transaction comprend une offre en espèces de 11,25 dollars par Action Ordinaire. Blackstone maintiendra une participation de 11,6 % après la clôture. Les Actions Ordinaires devraient être retirées de la cote du NYSE et du TSX le 2 mai 2024, avec Tricon cessant d'être un émetteur rapporteur. Des informations détaillées sur la Transaction sont disponibles dans le Circulaire et sur les sites web de SEDAR+ et SEC.
Blackstone Real Estate Partners X und Blackstone Real Estate Income Trust, Inc. haben die Privatisierung von Tricon Residential Inc. abgeschlossen, mit einem Gesamtwert der Transaktion von 3,5 Milliarden Dollar. Tricon bleibt dem Bau neuer Einfamilienhäuser und Wohnungen in den USA und Kanada verpflichtet, mit Plänen, 1 Milliarde Dollar in Kapitalprojekte zu investieren. Die Partnerschaft zielt darauf ab, die Qualität bestehender Wohnungen zu verbessern und erschwinglichen Wohnraum bereitzustellen. Die Transaktion beinhaltet ein Barangebot von 11,25 Dollar pro Stammaktie. Blackstone wird nach dem Abschluss einen Anteil von 11,6 % behalten. Es wird erwartet, dass die Stammaktien am 2. Mai 2024 von der NYSE und TSX delistet werden, mit Tricon, das aufhört, ein berichterstattender Emittent zu sein. Detaillierte Informationen zur Transaktion finden sich im Rundschreiben und auf den Websites von SEDAR+ und SEC.
Positive
Tricon's partnership with Blackstone provides access to capital and expertise to drive business growth.
The investment of $1 billion in capital projects demonstrates a commitment to improving housing quality.
Tricon's focus on developing new single-family homes and apartments in the U.S. and Canada aligns with market demands for affordable housing.
Negative
The de-listing of Common Shares from NYSE and TSX may impact liquidity for existing shareholders.
Tricon ceasing to be a reporting issuer could limit transparency and information available to investors.
Shareholders may need to consider Canadian and U.S. federal income tax considerations related to the Transaction.
Insights
Blackstone's acquisition of Tricon represents a significant consolidation in the real estate sector, particularly with the deal size of approximately $3.5 billion. From a financial standpoint, this transaction indicates a strategic move by Blackstone to deepen its investment in the housing market, as it secures a sizeable pipeline of $1 billion in single-family homes in the US and $2.5 billion in apartments in Canada. The per share acquisition price of $11.25 must be compared against historical share price data and industry multiples to assess whether the transaction reflects a premium on Tricon's intrinsic value. Furthermore, the return of capital distribution prior to the transaction's completion adds a layer to the total shareholder compensation, which deserves analysis in terms of yield and timing. For investors, the delisting from NYSE and TSX effectively removes the opportunity for public trading, which may impact individual investment strategies. It's imperative to evaluate the long-term growth potential under Blackstone's management against the loss of publicly traded liquidity.
From a market perspective, Blackstone's commitment to improving the quality of existing single-family homes with an additional $1 billion in capital projects could signify a positive trajectory for property values within Tricon's portfolio. The emphasis on market-rate and affordable housing addresses a critical need, possibly allowing Blackstone to leverage economies of scale and operational efficiencies. However, it's important to scrutinize the geographic distribution of these assets in relation to market trends, such as urbanization and population growth, which may influence the success of the investment. Investors should consider how demographic and socio-economic factors could affect the performance of Tricon's portfolio under Blackstone's leadership.
With the transfer of ownership comes a complex web of tax and regulatory considerations. For investors, understanding the specific Canadian and U.S. federal income tax implications as outlined in the Circular is important to evaluating the net financial outcomes of the transaction. Moreover, the deregistration of Common Shares poses governance and compliance changes that stakeholders must navigate. The role of advisors, including Morgan Stanley and Scotiabank, in guiding the transaction suggests thorough due diligence has been conducted; yet, investors should independently consider any potential regulatory hurdles or obligations that may arise post-acquisition.
Blackstone Remains Committed to Tricon’s Development Platform, including $1 Billion Pipeline of New Single-Family Homes in the U.S. and $2.5 Billion Pipeline of New Apartments in Canada; Plans to Improve Quality of Existing U.S. Single-Family Homes through an Additional $1 Billion of Capital Projects
All financial and share price-related information is presented in U.S. dollars unless otherwise indicated.
NEW YORK & TORONTO--(BUSINESS WIRE)--
Blackstone (NYSE: BX) and Tricon Residential Inc. (NYSE: TCN, TSX: TCN) (“Tricon” or the “Company”) today announced the closing of the previously-announced statutory plan of arrangement under the Business Corporations Act (Ontario) pursuant to which Blackstone Real Estate Partners X (“BREP X”), together with Blackstone Real Estate Income Trust, Inc. (“BREIT”), acquired all of the outstanding common shares of Tricon (“Common Shares”) for $11.25 per Common Share in cash (the “Transaction”) for a total equity transaction value of $3.5 billion. BREIT will maintain its approximately 11.6% ownership stake post-closing.
"This transaction marks an exciting new chapter in Tricon’s history, one poised to deliver exceptional outcomes for our residents," said Gary Berman, President & CEO of Tricon. "In partnership with Blackstone, we have the capital and expertise to take our business to the next level, including growing our Canadian multi-family development platform that is providing much needed market rate and affordable housing supply. In the U.S., we will continue to help hard-working American families access quality single-family homes and good schools in desirable neighborhoods, and our commitment to genuine, caring customer service remains unwavering."
Nadeem Meghji, Global Co-Head of Blackstone Real Estate, said, "We are thrilled to expand our partnership with Tricon and look forward to working with Gary and his team to grow the business, deliver additional high-quality apartment supply in Canada and single-family supply in the U.S., and continue Tricon’s track record of delivering a leading resident experience.”
The Common Shares are expected to be de-listed from the New York Stock Exchange on or about the opening of trading on May 2, 2024 and from the Toronto Stock Exchange on or about the closing of trading on May 2, 2024. It is anticipated that Tricon will apply to cease to be a reporting issuer under applicable Canadian securities laws and will deregister the Common Shares under the U.S. Securities Exchange Act of 1934, as amended.
For more information about the Transaction, please see the management information circular of the Company dated February 15, 2024 (the “Circular”) prepared in connection with the Transaction, and the Company’s subsequent related news releases, all of which are available on the SEDAR+ profile of Tricon at www.sedarplus.ca and Tricon’s filings with the SEC, including the Schedule 13E-3, which includes the Circular, on www.sec.gov.
The Company made a Return of Capital Distribution (as defined in the Circular) of approximately $3.10 per Common Share prior to the completion of the Transaction, representing approximately 28% of the total per Common Share consideration paid in connection with the Transaction, which, together with the Common Share Acquisition Price (as defined in the Circular) of $8.15, represents the $11.25 total consideration paid per Common Share to each shareholder of the Company (other than BREIT) in connection with the Transaction. Please see the Circular for a discussion of certain Canadian and U.S. federal income tax considerations relating to the Transaction.
Enclosed with the Circular was a letter of transmittal explaining how registered shareholders of the Company can submit their Common Shares in order to receive the consideration to which they are entitled in connection with the Transaction. Registered shareholders who have questions on how to complete the letter of transmittal should direct their questions to the Company’s transfer agent and depositary, TSX Trust, at 1-866-600-5869 (toll- free within North America) or at 416-342-1091 (outside of North America) or by email at txstis@tmx.com. Beneficial shareholders holding Common Shares that are registered in the name of an intermediary must contact their broker or other intermediary to submit their instructions with respect to the Transaction and to arrange for the surrender of their Common Shares in order to receive the consideration to which they are entitled in connection with the Transaction.
Advisors
Morgan Stanley & Co. LLC and RBC Capital Markets acted as financial advisors to Tricon. Scotiabank acted as independent financial advisor and independent valuator to the special committee of the board of directors of Tricon formed to evaluate the Transaction (the “Special Committee”).
Goodmans LLP and Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as legal counsel to Tricon in connection with the Transaction and Osler, Hoskin & Harcourt LLP acted as independent legal counsel to the Special Committee.
BofA Securities, Wells Fargo, Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, PJT Partners, TD Securities and Desjardins Capital Markets acted as Blackstone’s financial advisors and Simpson Thacher & Bartlett LLP and Davies Ward Phillips & Vineberg LLP acted as legal counsel.
About Tricon Residential Inc.
Tricon Residential Inc. (NYSE: TCN, TSX: TCN) is an owner, operator and developer of a growing portfolio of approximately 38,000 single-family rental homes in the U.S. Sun Belt and multi-family apartments in Toronto, Canada. Our commitment to enriching the lives of our employees, residents and local communities underpins Tricon’s culture and business philosophy. We provide high-quality rental housing options for families across the United States and in Toronto, Canada through our technology-enabled operating platform and dedicated on-the-ground operating teams. Our development programs are also delivering thousands of new rental homes and apartments as part of our commitment to help solve the housing supply shortage. At Tricon, we imagine a world where housing unlocks life’s potential. For more information, visit www.triconresidential.com.
About Blackstone
Blackstone is the world’s largest alternative asset manager. We seek to deliver compelling returns for institutional and individual investors by strengthening the companies in which we invest. Our more than $1 trillion in assets under management include global investment strategies focused on real estate, private equity, infrastructure, life sciences, growth equity, credit, real assets, secondaries and hedge funds. Further information is available at www.blackstone.com. Follow @blackstone on LinkedIn, X (Twitter), and Instagram.
Additional Early Warning Disclosure
BREIT, which made an initial $240 million exchangeable preferred equity investment in Tricon in 2020 and is maintaining its ownership stake, entered into a support agreement whereby it agreed to vote its Common Shares in favor of the Transaction. Immediately prior to the closing of the Transaction, BREIT indirectly held 35,210,634 Common Shares, representing an aggregate of approximately 11.6% of the then-outstanding Common Shares. Following the closing of the Transaction, Creedence Acquisition ULC (the “Purchaser”), a special purpose vehicle formed by BREP X to effect the Transaction, owns 100% of the outstanding Common Shares. Tricon is now a wholly-owned subsidiary of the Purchaser and BREIT will maintain an indirect ownership interest in Tricon. The consideration of $11.25 per Common Share received by shareholders (other than BREIT) represents approximately C$15.46 per Common Share based on the CAD-USD exchange rate published by the Bank of Canada on April 30, 2024. An early warning report with additional information in respect of the foregoing matters will be filed and made available on SEDAR+ at www.sedarplus.ca under Tricon’s profile or may be obtained directly upon request by contacting the Blackstone contact person named below. The head offices of the Purchaser, BREP X and BREIT are located at 345 Park Avenue, New York, New York 10154. The head office of Tricon is located at 7 St. Thomas Street, Suite 801, Toronto, Ontario M5S 2B7.
Forward-Looking Information
Certain statements contained in this news release may constitute forward-looking information within the meaning of applicable Canadian securities laws. Forward-looking information is often, but not always, identified by the use of words such as "anticipate", "plan", "expect", "may", "will", "intend", "should", and similar expressions. This information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. Forward-looking information in this news release includes, but is not limited to, the following: statements with respect to the delisting of the Common Shares and Tricon ceasing to be a reporting issuer following closing of the Transaction as well as statements regarding the intended conduct and growth of the Company’s business following closing of the Transaction.
Such forward-looking information and statements involve risks and uncertainties and are based on management’s current expectations, intentions and assumptions. Accordingly, although the Company believes that the expectations and assumptions on which the forward-looking information contained in this news release is based are reasonable, undue reliance should not be placed on the forward-looking information because Tricon can give no assurance that it will prove to be correct. Since forward-looking information addresses future events and conditions, by its very nature it involves inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks, including those described in Tricon’s annual information form and Tricon’s management’s and discussion and analysis for the year ended December 31, 2023 and in the other subsequent reports filed on the SEDAR+ profile of Tricon at www.sedarplus.ca and Tricon’s filings with the SEC, as well as the Schedule 13E-3 and Circular filed by Tricon.
The forward-looking information contained in this news release represents Tricon’s expectations as of the date hereof, and is subject to change after such date. Tricon disclaims any intention or obligation to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws.
This press release also includes forward-looking statements within the meaning of the federal securities laws and the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by the use of forward -looking terminology such as “outlook,” “indicator,” “believes,” “expects,” “potential,” “continues,” “identified,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates”, “confident,” “conviction” or other similar words or the negatives thereof. These may include financial estimates and their underlying assumptions and statements about plans, objectives, intentions, and expectations with respect to positioning, including the impact of macroeconomic trends and market forces, future operations, repurchases, acquisitions, future performance, development pipeline and identified but not yet closed acquisitions. Such forward-looking statements are inherently uncertain and there are or may be important factors that could cause actual outcomes or results to differ materially from those indicated in such statements. We believe these factors include but are not limited to those described under the section entitled “Risk Factors” in BREIT's prospectus and annual report for the most recent fiscal year, and any such updated factors included in BREIT's periodic filings with the SEC, which are accessible on the SEC's website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included herein (or in BREIT's public filings). Except as otherwise required by federal securities laws, we undertake no obligation to publicly update or revise any forward -looking statements, whether as a result of new information, future developments or otherwise.
