FC Private Equity Realty Management Corp. and Telsec Property Corporation Announce Acquisitions of Melcor REIT Trust Units and Remind Minority Unitholders of Mini Tender Offer

/EIN News/ -- TORONTO, Nov. 07, 2024 (GLOBE NEWSWIRE) -- Telsec Property Corporation ("Telsec"), a corporation controlled by Dick Van Grieken, and FC Private Equity Realty Management Corp. ("Firm Capital" and together with Telsec, the "Offerors") are pleased to announce that since October 22, 2024 they have collectively acquired 237,490 trust units ("Trust Units") of Melcor Real Estate Investment Trust ("Melcor REIT") through both the facilities of the Toronto Stock Exchange ("TSX") and the mini-tender offer proposed by the Offerors (the "Tender Offer") to unitholders of Melcor REIT other than Melcor Developments Ltd. ("Melcor Parent") and any related party of Melcor REIT or Melcor Parent ("Minority Unitholders").

As a result of these acquisitions, both Telsec and Firm Capital collectively own and/or control approximately 3.7 million Trust Units representing 12.8% of total Trust Units (28.7% of Trust Units held by minority unitholders).

Minority Unitholders should either sell Trust Units to the Tender Offer or Vote AGAINST the Take Under Offer: Minority unitholders should either sell their Trust Units to the Tender Offer or vote "AGAINST" the take under offer proposed by Melcor Parent (the "Take Under Offer") given the significant disconnect between the $8.70 per Trust Unit NAV and the Take Under Offer price of $4.95 per Trust Unit. Compounding this is a clear conflict of interest that is apparent between Melcor REIT and Melcor Parent given that taking the real estate private at a 43% discount to NAV would be a significant win for Melcor Parent who initially took the real estate public in 2013 at $10.00 per Trust Unit. Said differently, this would be a significant loss to minority unitholders if Melcor Parent were to succeed with the Take Under Offer.

Full details of the Tender Offer are available in the offer letter, letter of transmittal and any ancillary documentation thereto (the "Tender Offer Documents") made available to unitholders of Melcor REIT. Minority Unitholders can visit Melcor REIT's SEDAR+ profile on www.sedarplus.ca to access the Tender Offer Documents. The Tender Offer is subject to certain terms and conditions as set out in the Tender Offer Documents which, unless waived, must be satisfied. In particular, the Tender Offer Documents provide that each depositing Minority Unitholder whose Trust Units are taken up and paid for must appoint representatives of the Offerors as its nominees and proxies, for the upcoming special meeting of Melcor REIT unitholders scheduled to be held on November 26, 2024, and any adjournments or postponements thereof (the "Meeting").

Unitholder Questions

For further information regarding the Tender Offer, please contact:

Shorecrest Group Ltd.
North American Toll-Free: 1-888-637-5789
Calls outside North America: 647-931-7454
Email: contact@shorecrestgroup.com

Firm Capital and Telsec's Advisors

The Offerors have engaged Norton Rose Fulbright Canada LLP as legal advisor and Shorecrest Group Ltd. as proxy advisor and depositary and information agent.

About Firm Capital

FC Private Equity Realty Management Corp. is a leading real estate private equity investment firm in Toronto, Canada.

About Telsec

Telsec Property Corporation is a leading real estate developer in Calgary, Canada with commercial flex industrial, retail, office, and residential property for lease and sale.

Additional Information

The Offerors are relying on the exemption under section 9.2(4) of National Instrument 51-102 – Continuous Disclosure Obligations to make this public broadcast solicitation.

Any solicitation made by the Offerors in advance of the Meeting of unitholders of Melcor REIT to vote on the Take Under Offer is, or will be, as applicable, made by the Offerors, and not by or on behalf of management of Melcor REIT. All costs incurred for any solicitation will be borne by the Offerors, provided that, subject to applicable law, the Offerors may seek reimbursement from Melcor REIT for out-of-pocket expenses, including proxy solicitation expenses and legal fees.

Any proxies solicited by the Offerors may be solicited in reliance upon the public broadcast exemption to the solicitation requirements under applicable Canadian corporate and securities laws, conveyed by way of public broadcast, including press release, speech or publication, and by any other manner permitted under applicable Canadian securities laws. In addition, solicitation may be made by mail, telephone, facsimile, email or other electronic means as well as by newspaper or other media advertising and in person by representatives of the Offerors in accordance with Canadian securities laws and regulations. All costs incurred for such solicitation will be borne by the Offerors. The Offerors have also retained Shorecrest Group Ltd. as their proxy advisor and depositary and information agent under the Tender Offer. Shorecrest Group Ltd. will receive an anticipated fee of $75,000 for its services plus ancillary payments and disbursements. A registered Minority Unitholder (other than those attached to Trust Units taken up and paid for by the Offerors) may revoke a proxy by instrument in writing, including a proxy bearing a later date. The instrument revoking the proxy must be executed by the Minority Unitholder or Minority Unitholder's attorney authorized in writing and deposited at the registered office of Melcor REIT at any time up to and including the last business day preceding the date of the meeting, or an adjournment or postponement thereof at which the proxy is to be used, or with the chair of the meeting on the day of the meeting or an adjournment of the meeting, or in any other manner permitted by law or set out in the amended and restated declaration of trust of Melcor REIT, provided that, in each circumstance, a copy of such revocation has been delivered to Shorecrest Group Ltd. at its principal office at 250 University Ave., Suite 211 Toronto, Ontario M5H 3E5 during business hours prior to the Trust Units relating to such proxy having been taken up and paid for under the Tender Offer. A beneficial Minority Unitholder may revoke a form of proxy or voting instruction form given to an intermediary at any time by written notice to the intermediary in accordance with the instructions given to the beneficial Minority Unitholder by its intermediary. Beneficial Minority Unitholders should contact their broker for assistance in ensuring that forms of proxies or voting instructions previously given to an intermediary are properly revoked.

Other than in respect of the Take Under Offer, none of the Offerors nor, to their knowledge, any of their associates or affiliates, have any material interest, direct or indirect, in any transaction since the commencement of Melcor REIT's most recently completed financial year, or in any proposed transaction which has materially affected or will materially affect Melcor REIT or any of its subsidiaries. None of the Offerors nor, to their knowledge, any of their associates or affiliates, have any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in any matter to be acted upon at any upcoming unitholders' meeting (including the Special Meeting), other than as set out herein.

Based upon publicly available information, Melcor REIT's registered office and head office is located at 900, 10310 Jasper Av., Edmonton, Alberta, T5J 1Y8, Canada. A copy of this press release may be obtained on Melcor REIT's SEDAR+ profile at www.sedarplus.com.

Cautionary Statement Regarding Forward-Looking Information

Certain statements contained in this press release contain "forward-looking information" and are prospective in nature. Statements containing forward-looking information are not based on historical facts, but rather on current expectations and projections about future events, and are therefore subject to risks and uncertainties that could cause actual results to differ materially from the future outcomes expressed or implied by the statements containing forward-looking information. Often, but not always, statements containing forward-looking information can be identified by the use of forward-looking words such as "plans", "expects", "intends", "anticipates", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "should", "would", "might", or "will" be taken, occur or be achieved. Although the Offerors believe that the expectations reflected in statements containing forward-looking information herein made by it (and not, for greater certainty, any forward-looking statements attributable to Melcor REIT) are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed on such statements. Material factors or assumptions that were applied in formulating the forward-looking information contained herein include the assumption that the business and economic conditions affecting Melcor REIT's operations will continue substantially in the current state, including, without limitation, with respect to industry conditions, general levels of economic activity, continuity and availability of personnel, local and international laws and regulations, foreign currency exchange rates and interest rates, inflation, taxes, that there will be no unplanned material changes to Melcor REIT's operations, and that Melcor REIT's public disclosure record is accurate in all material respects and is not misleading (including by omission). The Offerors caution that the foregoing list of material factors and assumptions is not exhaustive. Many of these assumptions are based on factors and events that are not within the control of the Offerors and there is no assurance that they will prove correct. Important facts that could cause outcomes to differ materially from those expressed or implied by such forward-looking information include, among other things, actions taken by Melcor REIT in respect of the Tender Offer, the extension or variation of the Tender Offer by the Offerors, the content of subsequent public disclosures by Melcor REIT, the failure to satisfy the conditions to the Tender Offer or waiver thereof by the Offerors, the ultimate outcome of the Take Under Offer, general economic conditions, legislative or regulatory changes and changes in capital or securities markets. These are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of the Offerors' forward-looking information. Other unknown and unpredictable factors could also impact outcomes. Statements containing forward-looking information in this press release are based on Offerors' beliefs and opinions at the time the statements are made, and there should be no expectation that such forward-looking information will be updated or supplemented as a result of new information, estimates or opinions, future events or results or otherwise, and the Offerors disclaim any obligation to do so, except as required by applicable law.