Attached files
| file | filename |
|---|---|
| EX-99.2 - EXHIBIT 99.2 - Griffin Capital Essential Asset REIT, Inc. | gcearq42017investorupdat.htm |
| 8-K - 8-K - Griffin Capital Essential Asset REIT, Inc. | gcear-form8xkretenderoffer.htm |
April 18, 2018
DO NOT ACCEPT MACKENZIE TENDER OFFER
Dear Griffin Capital Essential Asset REIT, Inc. Stockholder:
On April 18, 2018, MacKenzie Capital Management, LP and its affiliates (collectively,
“MacKenzie”) commenced an unsolicited offer to purchase up to 1,000,000 shares of common stock of
Griffin Capital Essential Asset REIT, Inc. (the “Company”) at a price of $ 7.24 per share in cash (the
“MacKenzie Offer”). You should expect to receive offer materials for the MacKenzie Offer, if you have
not received them already. THIS IS NOT AN OFFER FROM GRIFFIN.
After carefully evaluating the MacKenzie Offer and consulting with our management, other
personnel of our external advisor and our outside legal advisor, THE BOARD OF DIRECTORS OF
THE COMPANY RECOMMENDS THAT YOU REJECT THE MACKENZIE OFFER AND NOT
TENDER YOUR SHARES. We believe the MacKenzie Offer is not in the best interests of our
stockholders for the following reasons:
• The Board believes the MacKenzie offer price is significantly less than the current and potential
long-term value of the shares. On October 24, 2017, the Board approved an estimated value per
share of the Company’s common stock of $10.04. MacKenzie’s offer price is $2.80 per share, or
27.8%, less than this estimated value per share.
• Given the offer price, the Board believes the MacKenzie Offer represents an opportunistic attempt by
MacKenzie to generate profit by purchasing the shares at a deeply discounted price relative to their
current estimated value, thereby depriving the stockholders who tender shares in the MacKenzie
Offer of the potential opportunity to realize the full long-term value of their investment in the
Company. Specifically, the Board notes the following statement in the MacKenzie materials: “ The
Buyers are making this offer in view of making a profit, so the price offered is below the estimate
of value as established by the Buyers… ” The Board further notes that MacKenzie previously
acquired 205,545 of our shares via a prior tender offer (of up to 1,000,000 shares) and other means.
• MacKenzie acknowledges it and its affiliates “are not real estate appraisers and the value of the
assets may not accurately represent the current or future value of the Shares.” MacKenzie further
states “No independent person was retained to evaluate or render any opinion with respect to the
fairness of the Purchase Price.” The Board believes this illustrates the lack of creditability of
MacKenzie’s valuation methods and the inadequacy of the offer price.
• The secondary market trade prices quoted by MacKenzie in their offer to purchase are (1) more than
the MacKenzie Offer and (2) transacted in a system that typically transacts at values well below net
asset value.
In light of the reasons considered above, the Board unanimously determined accepting the
MacKenzie Offer is not advisable and is not in the best interests of the stockholders. Accordingly, the
Board unanimously recommends the stockholders reject the MacKenzie Offer and NOT tender
their shares for purchase pursuant to the MacKenzie Offer.
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pril 18, 2018
N A I
ear riffin apital Essential sset I , Inc. Stockholder:
n April 18, 2018, ac enzie Capital anage ent, L and its affiliates (collectively,
“ ac enzie”) co enced an unsolicited offer to purchase up to 1,000,000 shares of co on stock of
riffin apital Essential sset I , Inc. (the “Co pany”) at a price of $ 7.24 per share in cash (the
“ ac enzie ffer”). You should expect to receive offer aterials for the ac enzie ffer, if you have
not received the already. I I G I I .
fter carefully evaluating the acKenzie ffer and consulting ith our anage ent, other
personnel of our external advisor and our outside legal advisor, I
C R J I N
. e believe the acKenzie ffer is not in the best interests of our
stockholders for the follo ing reasons:
• he oard believes the ac enzie offer price is significantly less than the current and potential
long-ter value of the shares. n ctober 24, 2017, the Board approved an esti ate val e er
share of t e any’s co o stoc of $10.04. c enzie’s offer price is $2.80 er share, or
27.8 , less tha t is esti ate val e per share.
• iven the offer price, the oard believes the ac enzie Offer represents an opportunistic atte pt by
ac enzie to generate profit by purchasing the shares at a deeply discounted price relative to their
current esti ated value, thereby depriving the stockholders who tender shares in the acKenzie
ffer of the potential opportunity to realize the full long-ter value of their invest ent in the
o pany. Specifically, the oard notes the follo ing state ent in the ac enzie aterials: “ e
uyers are aki g t is offer i vie of aki g a profit, so t e price offered is belo t e esti ate
of val e as established by the Buyer ” e oard further notes that ac enzie previously
acquired 205,545 of our shares via a prior tender offer (of up to 1,000,000 shares) and other eans.
• ac enzie ackno ledges it and its affiliates “are not real estate appraisers and the value of the
assets ay not accurately represent the current or future value of the Shares.” ac enzie further
states “No independent person was retained to evaluate or render any opinion ith respect to the
fairness of the Purchase Price.” he Board believes this illustrates the lack of creditability of
ac enzie’s valuation ethods and the inadequacy of the offer price.
• he secondary arket trade prices quoted by ac enzie in their offer to purchase are (1) ore than
the ac enzie ffer and (2) transacted in a syste that typically transacts at values ell belo net
asset value.
In light of the reasons considered above, the Board unani ously deter ined accepting the
ac enzie Offer is not advisable and is not in the best interests of the stockholders. ccor i gly, t e
oar na i ously reco ends t e stockhol ers reject t e c enzie ffer an ten er
their s ares for p rchase rsua t to t e ac enzie ffer.
A ril , 2
DO OT CCEPT ACKENZIE TENDER OFFER
D r Griffi C it l s ti l Ass t REIT, I . t l r:
O ril , 2 , M K i it l M m t, P its ffili t s ( ll ti l ,
“M K i ”) mm li it ff r t p r s t 1, s r s of mm st of
Griffi C it l s ti l Ass t REIT, I . (t “Com ”) at pri f $ . p r r i s (t
“M K i Off r”). Y s l t t r i off r m t ri ls f r t M K i Off r, if
t r i t m alr . THIS IS NOT AN OFFER FRO RIFFIN.
Aft r c r f ll e l ti t M i Off r lti wit o r m m t, t r
rs l of r t r l i r a r tsi l l i r, THE BOARD OF DIRECTORS OF
THE O PANY ECO ENDS THAT YOU RE ECT THE MACKENZIE OFFER AND OT
TENDER YOUR SHARES. W li t M i Off r is n t i t st i t r sts f o r
st l rs f r t f ll wi r s:
• T B r b li s t M K i off r pri is si ifi tl l ss t t rr t p t ti l
l -t rm l f t s r s. O O t r , 2 , t r r stim t d v lu p
f th Comp ’s mm n st k f . . Ma K i ’s ff i is p ,
, l ss t n this stim t d v lu s .
• Gi t ff r ri , t B r li s t M K i ff r r r s ts rt isti att m t b
M K i t r t r fit b r si t s r s at l dis t ri r l ti t t ir
rr t estim t l , t r ri i t st l rs t r sh r s i t M i
Off r of t t ti l rt it t r li t f ll l -t rm l of t ir i stm t i t
C m . ifi ll , t B r n t s t f ll wi st t m t i t M K i m t ri ls: “ Th
B rs r m in this ff r in i w f m in r fit, s th ri ff r is l w th stim t
f v lu s est li y t s… ” Th B r f rt r t s t t M K i pr i sl
ir of r s r s i ri r t r ff r ( f t s r s) t r m s.
• M K i wl s it its ffili t s “ r n t r l st t r is rs t l of t
ss ts m t a r t l r r s t t rr t r f t r l f t r s.” M K i f rt r
st t s “N i t p r s r t i t e l t or r r i i wit r s t t t
f ir ss f t r s ri .” T r b li s t is ill str t s t l of r it ilit of
M K i ’s l ti m t s t i of t ff r ri .
• T s r m r t tr pri s t b M K i i t ir off r t r s r ( ) m r t
t M K i Off r ( ) tr s t i s st m t t t i ll tr s ts t l s w ll b l w t
ss t l .
I li t of t r s s si r , t r im l t rmi ti t
M K i f r is n t is l is n t i t b st i t r sts of t st l rs. A din l , th
B d u nim sl mm s th st ld s j t th Ma K i Off d NOT t d
t i sh s f u s pu s nt t th K i Off .
pril 18, 2018
N A I
ear riffin apital Essential sset I , Inc. Stockholder:
n April 18, 2018, ac enzie Capital anage ent, L and its affiliates (co lectively,
“ ac enzie”) co enced an unsolicited offer to purchase up to 1,000,000 shares of co on stock of
riffin apital Essential sset I , Inc. (the “Co pany”) at a price of $ 7.24 per share in cash (the
“ ac enzie ffer”). You should expect to receive offer aterials for the ac enzie ffer, if you have
not received the already. I I G I I .
fter carefu ly evaluating the acKenzie ffer and consulting ith our anage ent, other
personnel of our external advisor and our outside legal advisor, I
C R J I N
. e believe the a nzie ffer is not in the best interests of our
stockholders for the fo lo ing reasons:
• he oard believes the ac enzie offer price is significantly less than the current and potential
long-ter value of the shares. n ctober 24, 2017, the rd approved an esti ate val e er
share of t e any’s co o stoc of $10.04. c enzie’s offer price is $2.80 er share, or
27.8 , less tha t is esti ate val e per share.
• iven the offer price, the oard believes the ac enzie Offer represents an opportunistic a te pt by
ac enzie to generate profit by purchasing the shares at a deeply discounted price relative to their
current esti ated value, thereby depriving the stockholders who tender shares in the acKenzie
ffer of the potential opportunity to realize the fu l long-ter value of their invest ent in the
o pany. Specifica ly, the oard notes the follo ing state ent in the ac enzie aterials: “ e
uyers are aki g t is offer i vie of aki g a profit, so t e price offered is belo t e esti ate
of val e as established by the Buyer ” e oard further notes that ac enzie previously
acquired 205,545 of our shares via a prior tender offer (of up to 1,000,000 shares) and other eans.
• ac enzie ackno ledges it and its affiliates “are not real estate appraisers and the value of the
assets ay not accurately represent the current or future value of the Shares.” ac enzie further
states “No independent person was retained to evaluate or render any opinion ith respect to the
fairness of the Purchase Price.” he Board believes this i lustrates the lack of creditability of
ac enzie’s valuation ethods and the inadequacy of the offer price.
• he secondary arket trade prices quoted by ac enzie in their offer to purchase are (1) ore than
the ac enzie ffer and (2) transacted in a syste that typica ly transacts at values e l belo net
asset value.
In light of the reasons considered above, the Board unani ously deter ined accepting the
ac enzie Offer is not advisable and is not in the best interests of the stockholders. ccor i gly, t e
oar na i ously reco ends t e stockhol ers reject t e c enzie ffer an ten er
their s ares for p rchase rsua t to t e ac enzie ffer.
Griffin Capital Plaza | 1520 E. Grand Avenue | El Segundo, CA 90245 | 310.469.6100 | www.griffincapital.com
D r Valued Shareholder:
We are pleased to provide you with the enclosed Griffin Capital Essential Asset REIT II (GCEAR2) First Quarter 2016
Investor Update. Please note, that we inadvertently distributed to some of you an investor update from a different
company sponsored by Griffin Capital Corporation, Griffin Capital Essential Asset REIT, Inc. (GCEAR). If you received
this, please disregard and use the enclosed as your quarterly update.
We continue to add investment grade tenants(1) to our rowing po tfolio and look forward to keeping you
informed of all transactions in your next quarterly update.
Kevin A. Shields
Chairman nd CEO
Griffin Capital Corpor tion
(1) We intend to invest in properties leased to blue chip tenants and/or companies with inv stmen grade credit ratings. There is no
guarantee all of our properties will be leased to blue chi tenants or companies with investment grade credit ratings. Blue chip
companies are well-known and respected publicly traded companies that typically make up the Dow Jones group of companies. Blue
chip and investment grade descriptions are hose of either tenants nd/or guarantor wi h investment gr de credit r tings or w ose
non-guar ntor parent companies h v investm nt grade credit atings.
45145_GCEAR Response_r1.indd 2 4/17/18 8:37 AM
The Board acknowledges that, as of September 30, 2017, the Company reached the annual share
limit under the share redemption program (“SRP”) for 2017 . The Company opened the SRP redemption
window beginning on January 1, 2018. Please see the Company’s Annual Report on Form 10-K filed
with the SEC on March 9, 2018 for additional details regarding the SRP. The Board will continue to
consider the liquidity available to stockholders going forward, balanced with other long-term interests of
the stockholders and the Company. It is possible that in the future additional liquidity will be made
available by the Company through the SRP, issuer tender offers or other methods, though we can make no
assurances as to whether that will happen, or the timing or terms of any such liquidity.
The Board notes that each stockholder must evaluate whether to tender his or her shares in the
MacKenzie Offer and that an individual stockholder may determine to tender based on, among other
considerations, such stockholder’s individu al liquidity needs. In making a decision as to whether to tender
his or her shares in the MacKenzie Offer, each stockholder should keep in mind that (a) the SRP has
certain restrictions and limitations and (b) the Board makes no assurances with respect to (i) future
distributions (which can change periodically) or (ii) the timing of providing liquidity to the stockholders.
The Board believes any offer significantly less than the Company’s current estimated value per
share, such as the current MacKenzie Offer, is not in the best interests of our stockholders. Any
communication from the Board or the Company will be clearly indicated as such and will not be sent on
our behalf by a third party.
We appreciate your trust in the Company and its Board of Directors and thank you for your
continued support. WE ENCOURAGE YOU TO FOLLOW THE BOARD OF DIRECTORS’
RECOMMENDATION AND NOT TENDER YOUR SHARES IN THE MACKENZIE OFFER.
Sincerely,
Kevin A. Shields
Chairman of the Board and Chief Executive Officer
Griffin Capital Essential Asset REIT, Inc.
45145_GCEAR Response_r1.indd 3 4/17/18 8:37 AM