W. P. Carey Inc. (NYSE:WPC) entered into an agreement and plan of merger to acquire Corporate Property Associates 18 - Global Incorporated for $1.6 billion on February 27, 2022. Corporate Property Associates 18 – Global Incorporated (“CPA:18”) will be acquired by W. P. Carey in a transaction valued at approximately $2.7 billion, including the assumption of debt of $1.1 billion. Subject to the terms and conditions of the merger agreement, CPA:18 stockholders will be entitled to receive a fixed exchange ratio of 0.0978 of a share of W. P. Carey common stock plus $3.00 of cash (subject to certain adjustments as set forth in the merger agreement) for each share of CPA:18 common stock held by them, representing total consideration with an initial implied value of $10.45 per share. W. P. Carey expects to fund the aggregate cash consideration with net proceeds from sales of certain CPA:18 assets contemplated to occur prior to the closing of the transaction and existing liquidity. The agreement also provides CPA:18 with a 30-day go-shop provision continuing through March 30, 2022. CPA:18 has agreed to pay W. P. Carey a termination fee equal to $47 million; provided, however, in the event that CPA:18 enters into an alternative acquisition agreement with a person or entity from whom it received a bona-fide written offer or other communication constituting a CPA18 competing transaction prior to the expiration of the go-shop period, the termination fee will be reduced to $15.7 million.
The Board of Directors of W. P. Carey Inc. has unanimously approved the transaction. The transaction has also been approved by CPA:18's Board of Directors upon the unanimous recommendation of a Special Committee of CPA:18's independent directors. The completion of the transaction is subject to, among other things, effectiveness of the Form S-4, the approval of the CPA:18 stockholders and satisfaction of customary closing conditions. Completion of the transaction is not subject to approval by W. P. Carey's stockholders nor to any financing contingency. The registration statement was declared effective by the SEC on April 27, 2022. At a special meeting of stockholders held on July 26, 2022, transaction was approved by the shareholders of CPA:18. The transaction is currently expected to close during the third quarter of 2022. As of April 29, 2022, the transaction is expected to close in early August 2022. As of July 29, 2022 the transaction is expected to close on August 1, 2022.
BofA Securities acted as the lead financial advisor and fairness opinion provider, Wells Fargo Securities, LLC acted as the co-financial advisor and Jon Venick and Christopher P. Giordano of DLA Piper LLP (US) acted as the legal advisor to W. P. Carey. Morgan Stanley & Co. LLC acted as the financial advisor and fairness opinion provider to the CPA:18 Special Committee. Kathleen L. Werner, Mike Seaton and l Rebecca Pereira of Clifford Chance US LLP acted as the legal advisor to CPA:18 and Barry M. Abelson of Troutman Pepper Hamilton Sanders LLP acted as the legal advisor to the CPA:18 – Global Special Committee. Computershare Investor Services is the transfer agent for shares of W. P. Carey. Broadridge Investor Communication Solutions, Inc. is acting as the proxy solicitation agent for W. P. Carey for a fee of $200,000. CPA:18 has agreed to pay Morgan Stanley an aggregate fee of $6 million. In addition, the engagement letter provides for an additional fee of up to $4 million payable in the sole discretion of the CPA:18.
W. P. Carey Inc. (NYSE:WPC) completed the acquisition of Corporate Property Associates 18 - Global Incorporated on August 1, 2022.