MCB Calls on Whitestone to Maximize Shareholder Value
MCB Real Estate, managing approximately $3 billion in assets, has issued a statement regarding its $15.00 per share cash proposal to acquire Whitestone REIT (NYSE: WSR). The offer represents a 14.5% premium to Whitestone's share price prior to MCB's initial June 2024 proposal and a 61.8% premium to the price before the rumored Fortress proposal in October 2023. The Whitestone Board has rejected MCB's improved proposal and refused to engage in meaningful discussions. MCB highlights that Whitestone delivered only 0.1% total shareholder returns under current management before takeover interest emerged, and questions the board's refusal to grant due diligence or explore strategic alternatives.
MCB Real Estate, che gestisce circa $3 miliardi in attivi, ha emesso una dichiarazione riguardante la sua proposta di acquisto in contanti di $15,00 per azione per acquisire Whitestone REIT (NYSE: WSR). L'offerta rappresenta un premio del 14,5% rispetto al prezzo delle azioni di Whitestone prima della proposta iniziale di MCB di giugno 2024 e un premio del 61,8% rispetto al prezzo prima della ventilata proposta di Fortress nell'ottobre 2023. Il Consiglio di Whitestone ha respinto la proposta migliorata di MCB e ha rifiutato di impegnarsi in discussioni significative. MCB sottolinea che Whitestone ha fornito solo lo 0,1% di ritorni totali per gli azionisti sotto l'attuale gestione prima che emergesse l'interesse per un'acquisizione, e mette in dubbio il rifiuto del consiglio di concedere la due diligence o esplorare alternative strategiche.
MCB Real Estate, que gestiona aproximadamente $3 mil millones en activos, ha emitido un comunicado sobre su propuesta en efectivo de $15.00 por acción para adquirir Whitestone REIT (NYSE: WSR). La oferta representa una prima del 14.5% sobre el precio de las acciones de Whitestone antes de la propuesta inicial de MCB de junio de 2024 y una prima del 61.8% sobre el precio antes de la supuesta propuesta de Fortress en octubre de 2023. La Junta de Whitestone ha rechazado la propuesta mejorada de MCB y se ha negado a participar en discusiones significativas. MCB destaca que Whitestone ha entregado solo un 0.1% de retornos totales para los accionistas bajo la gestión actual antes de que surgiera el interés por la adquisición, y cuestiona la negativa de la junta a conceder la debida diligencia o explorar alternativas estratégicas.
MCB 부동산은 약 30억 달러의 자산을 관리하며, Whitestone REIT (NYSE: WSR)를 인수하기 위한 주당 15.00달러의 현금 제안에 대한 성명을 발표했습니다. 이 제안은 MCB의 2024년 6월 초기 제안 이전의 Whitestone 주가보다 14.5%의 프리미엄을 나타내며, 2023년 10월 Fortress 제안 소문 이전의 가격에 대해서는 61.8%의 프리미엄을 제공합니다. Whitestone 이사회는 MCB의 개선된 제안을 거부하고 실질적인 논의에 참여하기를 거부했습니다. MCB는 Whitestone이 인수 관심이 나타나기 전 현재 경영 하에 단 0.1%의 총 주주 수익률만을 제공했다고 강조하며, 이사회가 실사 제공이나 전략적 대안 탐색을 거부하는 것에 의문을 제기합니다.
MCB Real Estate, gérant environ 3 milliards de dollars d'actifs, a publié un communiqué concernant sa proposition d'achat en espèces de 15,00 $ par action pour acquérir Whitestone REIT (NYSE: WSR). Cette offre représente une prime de 14,5 % par rapport au prix de l'action de Whitestone avant la proposition initiale de MCB en juin 2024 et une prime de 61,8 % par rapport au prix avant la proposition présumée de Fortress en octobre 2023. Le Conseil d'administration de Whitestone a rejeté la proposition améliorée de MCB et a refusé de s'engager dans des discussions significatives. MCB souligne que Whitestone n'a fourni qu'un retour total de 0,1 % pour les actionnaires sous la direction actuelle avant l'intérêt pour une prise de contrôle, et remet en question le refus du conseil d'administration d'accorder la due diligence ou d'explorer des alternatives stratégiques.
MCB Real Estate, das etwa 3 Milliarden Dollar an Vermögenswerten verwaltet, hat eine Erklärung zu seinem barbasierten Angebot von 15,00 $ pro Aktie zur Übernahme von Whitestone REIT (NYSE: WSR) abgegeben. Das Angebot stellt eine Prämie von 14,5 % gegenüber dem Aktienkurs von Whitestone vor dem ursprünglichen Angebot von MCB im Juni 2024 und eine Prämie von 61,8 % gegenüber dem Preis vor dem gerüchtenhaften Fortress-Angebot im Oktober 2023 dar. Der Whitestone-Vorstand hat das verbesserte Angebot von MCB abgelehnt und sich geweigert, in bedeutende Gespräche einzutreten. MCB hebt hervor, dass Whitestone unter der aktuellen Leitung vor dem Übernahmeinteresse nur eine Gesamtrendite von 0,1 % für die Aktionäre erzielt hat, und stellt die Weigerung des Vorstands in Frage, eine Due Diligence zu gewähren oder strategische Alternativen zu erkunden.
- MCB's $15.00 per share cash offer represents a 14.5% premium to pre-proposal price
- 61.8% premium to unaffected share price before Fortress proposal
- MCB holds significant position with 4,690,000 shares
- Board's rejection of acquisition proposal without due diligence
- Only 0.1% total shareholder returns under current management before takeover interest
- High cost of capital and borrowing issues noted
- Apparent inability to raise new equity
Insights
This activist investor situation presents significant implications for Whitestone REIT shareholders. MCB's
The most telling metrics here are Whitestone's historical performance: a mere
The Board's resistance to engage in due diligence or strategic alternatives review raises governance concerns. Their rejection without transparent NAV or DCF analysis leaves shareholders without important information to evaluate the offer's fairness. The potential for share price pressure if MCB exits its position presents a meaningful downside risk.
The dynamics of this potential acquisition deserve careful scrutiny. Whitestone's portfolio of retail properties in high-growth sunbelt markets has strategic value, but the company faces challenges with its cost of capital and borrowing that impact growth potential. MCB, managing
The Board's entrenchment poses risks to shareholder value, particularly given the company's underperformance versus peers and apparent inability to raise new equity efficiently. The lack of a formal strategic review process or independent committee evaluation suggests potential governance gaps that could impact long-term value creation.
The Whitestone Board Has Summarily Rejected and Refused to Engage Regarding MCB's Improved
MCB Urges the Whitestone Board and Management Team to Cease their Entrenchment Tactics
and Answer Shareholders' Questions
MCB Calls on Whitestone Shareholders to Make their Voices Heard;
Visit www.MaximizingWhitestoneValue.com for More Information
MCB stands ready to deliver immediate and certain value to Whitestone shareholders. Our proposal is compelling by all reasonable metrics, reflecting a
In its rejection, Whitestone has conveniently chosen a time period of total shareholder return that includes multiple acquisition rumors and proposals, as well as MCB acquiring 4,690,000 shares on the open market. In the time between January 18, 2022, when current Whitestone management took over, and October 25, 2023, the day prior to the rumored Fortress proposal, Whitestone delivered total shareholder returns of
We have heard from other shareholders that they are supportive of a potential transaction and share our frustration with the Whitestone Board. The Board's refusal to grant due diligence, engage in any meaningful discussions, or commence a strategic alternatives process is not consistent with its duties and indicates that the Board is entrenched. Whitestone shareholders deserve answers, and MCB encourages Whitestone to address the following questions on its earnings call this morning, so that shareholders can have all the facts regarding Whitestone's refusal to engage or present a compelling path to maximize shareholder value as a public company.
- What does the Whitestone Board believe the Company's net asset value (NAV) to be?
- Whitestone has implied its NAV and discounted cash flow (DCF) based on its internal forecasts indicate a higher "intrinsic value" than provided by MCB's improved proposal – what are those forecasts?
- Why not share the NAV and DCF forecasts with MCB or other potential counterparties?
- What purchase price would the Board need to see in order to grant due diligence?
- How can Whitestone's Board reasonably credit the management team for the
60% total shareholder returns since the management team was appointed, considering that total shareholder returns during the period prior to takeover interest were almost zero? - Given that MCB's purchases represent a significant portion of WSR's trading volume over the course of 2024, what is Whitestone's plan to maintain its share price if MCB withdraws its offer and liquidates its position?
- Has Whitestone engaged with independent advisors or formed a committee of the board to evaluate MCB's proposal or explore strategic alternatives to maximize value? If not, why not?
- Is Whitestone's Board open to running a formal process to evaluate strategic alternatives?
- How can the Board justify its refusal to engage with qualified buyers, such as Fortress and MCB?
- Does Whitestone recognize its continued underperformance versus its peers, and how does management intend to address Whitestone's high cost of capital, high cost of borrowing and apparent inability to raise new equity?
- Will the Whitestone Board and management team spend shareholders' capital defending against a proxy contest again this year? How can that be justified and why is that preferable to engaging with well-capitalized potential acquirers?
Whitestone Third Quarter 2024 Conference Call Details
MCB urges Whitestone shareholders to join Whitestone's Third Quarter 2024 earnings conference call to listen to the Whitestone management team's responses to these and other questions. P. David Bramble, Managing Partner of MCB, will join the call and attempt to ask a question, but based on Whitestone's refusal to engage to date, MCB expects to be rebuffed, again, and is therefore calling on others in the investment community to demand the answers shareholders deserve.
Dial-in number for domestic participants: 1-877-407-0784
Dial-in number for international participants: 1-201-689-8560
Passcode: 13742564
A live webcast of Whitestone's conference call can be accessed at https://ir.whitestonereit.com/corporate-profile/
Additional Materials
Additional materials regarding the proposed transaction, including a letter sent to Whitestone's Board on October 9, 2024 detailing MCB's enhanced proposal, are available at www.MaximizingWhitestoneValue.com.
Advisors
MCB has engaged Vinson & Elkins LLP as lead counsel in connection with the transaction. Wells Fargo is serving as financial advisor to MCB.
About MCB Real Estate
Founded in 2007, MCB Real Estate is a community-centric, privately held institutional investment management firm headquartered in
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SOURCE MCB Real Estate
FAQ
What is MCB's cash offer per share for Whitestone REIT (WSR)?
What premium does MCB's offer represent for Whitestone REIT (WSR) shareholders?
How many shares of Whitestone REIT (WSR) does MCB currently own?
What was Whitestone REIT's (WSR) shareholder return under current management before takeover interest?
