NVU-UN.TO - Northview Apartment REIT

[wisowis]

NorthView Apartment REIT is a multi-family residential REIT with locations across Canada.

 

They have significant exposure to Ontario (good market), Western Canada (not so good), and Northern Canada (probably neutral). (https://s3.amazonaws.com/lws_lift/northview/documents/1570581219_nvu_investor_presentation_-_october.pdf)

 

On February 20th, Starlight Capital (who already owns a stake in NorthView) went into an agreement to acquire NorthView for $36.25 in cash (https://www.northviewreit.com/investor-relations/media-releases/m/1987789). There is a go-shop period of up to 60 days, and deal is expected to close in Q3 2020.

 

NorthView REIT is currently trading at ~28$. Market clearly thinks that the deal will fall apart, probably due to the collapse in oil prices and associated economic slowdown. However, this is a residential REIT (so no immediate effects from COVID), and StarLight has a good reputation and knows the company well.

 

Anyone looking at this?

[NewValueinvestor]

Just reading over the news release, they plan on closing the deal in Q3 2020. This seems like a binary situation, where if there's a economic slowdown or recession, this falls through and if the economy can keep it together it could.

 

I live in western canada and the decline in the price of oil will cause people to leave once the layoffs start, just like the last bust, so their western canada operations could be impaired.

[wisowis]

https://www.northviewreit.com/investor-relations/media-releases/m/2004709

 

Announced end of go-shop period.

Received 2 other proposals, neither better than existing offer.

Waived clause preventing Starlight from buying units in open market (up to 19.9% of outstanding shares, from existing 13%)

Now trading at ~$31.

 

 

[Simon]

It looks like the special meeting got pushed back from May 6th to May 25th.

 

I also bought some NVU.UN shares after the deal was announced. The one thing I'm not clear on is if the deal could fall apart if very few unitholders opt for units in the new high yield fund (there is a "Minimum Additional Subscription Amount" for "NV2" in the arrangement agreement posted on SEDAR).

 

Looking forward to reading the circular when it gets posted.

[wisowis]

Circular: https://s3.amazonaws.com/lws_lift/northview/documents/1588273439_2020_management_information_circular.pdf

 

Operational update: collected ~95% of rent in April: https://www.northviewreit.com/investor-relations/media-releases/m/2023287

[Simon]

The vote on the plan of arrangement was held today and it was approved.

 

Management noted the only real remaining condition to be fulfilled is the consent of CMHC and certain Northview lenders. The timing of this is uncertain but management continues to expect the transaction to close in Q3 2020.

 

A bit surprised the shares continue to trade in the $33 range.

 

 

[wisowis]

Deal closing November 2, 2020

 

https://www.northviewreit.com/investor-relations/media-releases/m/2100969

 

– Northview Apartment Real Estate Investment Trust (“Northview”)

(TSX: NVU.UN) today announced that its previously disclosed plan of arrangement with affiliates of Starlight Group

Property Holdings Inc. (“Starlight”) and KingSett Capital Inc. (“KingSett”) (collectively, the “Purchasers”), pursuant to

which the Purchasers will acquire Northview and unitholders will receive consideration of $36.25 per Northview trust

unit (the “Transaction”), is scheduled to close the week of November 2, 2020.

The Purchasers have waived material closing conditions, including consents from Canada Mortgage Housing

Corporation and lenders. Northview has suspended its October distribution payable to unitholders, making the

September 2020 distribution in the amount of $0.1358 per trust unit – payable on October 15, 2020 to holders of trust

units of record at September 30, 2020 – the final regular monthly distribution.

[wisowis]

Probably no one cares, but the deal closed today.

 

Northview Apartment REIT Announces Close of Sale to Starlight and KingSett

 

CALGARY, Alberta, Nov. 02, 2020 (GLOBE NEWSWIRE) -- Northview Apartment Real Estate Investment Trust (“ Northview ”) (TSX:NVU.UN) today announced that the previously announced arrangement agreement with affiliates of Starlight Group Property Holdings Inc. (“ Starlight ”) and KingSett Capital Inc. (“ KingSett ”) (collectively, the “ Purchasers ”), pursuant to which the Purchasers acquired Northview in a $4.9 billion transaction (the “ Transaction ”), including net debt, has closed as of today. Unitholders of Northview received $36.25 per unit in the Transaction. In addition, pursuant to the Transaction unitholders received a stub distribution pro-rated for the month of November of $0.004526667 per unit in cash. Northview’s distribution reinvestment plan was not applicable for this stub distribution. As a result of the Transaction closing, Northview’s units will cease to be traded on the Toronto Stock Exchange as of November 3, 2020.

 

 

[Simba]

Still time to pick up shares to collect the 5 cent spread?

 

Congrats to all longs.. Missed this one..