Q: Could you comment on the propose take-over by BREIT. The offer looks cheap to me compare with today real book value. If it goes thru, will the new legislation law by the Democrats affect BREIT? Are you expecting outbid?
Thanks
Thanks
5i Research Answer:
This is what happens when a stock stays cheap for too long. It is an all-cash, friendly bid at a 30% premium ($11.25 US). It is clean, as far as bids go. It is lower than TCN's peak price in early 2022, but we would consider it a good bid, and we are not sure how many parties would like to get into a bidding war with Blackstone. The dividend will be suspended, Blackstone can match any other bid, and there is 'at least' a $61M break fee. With these terms, we do doubt any other party shows up. We do not know at this time if the proposed legislation (discussed in yesterday's Q&A) will affect the buyer.