Equity Office Properties Trust's board of trustees reaffirmed its recommendation that shareholders approve The Blackstone Group's $54-per-share cash bid to purchase the REIT at its Feb. 7 meeting, according to an amended proxy statement filed today with the SEC.
The board rejected a rival bid by a consortium led by Vornado Realty Trust, an office REIT, to buy Equity Office for $56 per share in cash and stock. The board is recommending Blackstone's offer because there is less risk involved.
The Blackstone deal would close on Feb. 9, while a Vornado transaction would not close for four to six months, pending a shareholder vote and a potential SEC review. Also, the current value of the Vornado offer is between $54.28 and $54.88 per share, including dividends, and "the approximately 1% higher net present value of the Vornado offer fails to adequately compensate Equity Office shareholders for the increased risk."