NEWPORT BEACH, Calif. and
SAN DIEGO, Aug. 31, 2019 /PRNewswire/ -- KBS Strategic
Opportunity REIT, Inc. ("SOR") and Reven Housing REIT, Inc.
("Reven") (NASDAQ: RVEN) today announced the signing of a
definitive merger agreement under which an indirect, wholly-owned
subsidiary of SOR, SOR PORT, LLC
("Merger Sub"), a wholly-owned subsidiary of SOR PORT Holdings, LLC
("Parent"), will acquire all of the outstanding shares of common
stock of Reven for cash. The aggregate merger consideration
payable for shares of Reven common stock in the merger will equal
approximately $56.85 million, to be
increased or decreased, as the case may be, by the difference, if
any, between the amount of Reven's unrestricted cash available for
distribution as of the closing date of the merger, and $6,500,000. Based on Reven management's
current estimate, the per share merger consideration payable to
Reven stockholders in the merger is expected to be $5.15, which amount represents an approximately
21% premium to Reven's unaffected closing stock price of
$4.25 on August 29, 2019, the last reporting day before
Reven announced the signing of the merger agreement.
Under the merger agreement, at the effective time of the merger,
each unvested Reven restricted stock award will become fully vested
and will be automatically converted into the right to receive the
per share merger consideration for each share of Reven common stock
underlying such award.
In connection with the signing of the merger agreement, Parent
has delivered to Reven an equity commitment letter, pursuant to
which SOR has committed to purchase, directly or indirectly through
one or more affiliated entities, equity securities of Parent for a
maximum amount equal to the aggregate merger consideration payable
under the merger agreement. The funding of the commitment
under the equity commitment letter is not a condition to Parent's
obligation to consummate the merger.
The merger and the other transactions contemplated by the merger
agreement have been unanimously approved by the Board of Directors
of SOR and approved by the Board of Directors of Reven.
Pursuant to the merger agreement, the closing of the merger is
subject to customary closing conditions, including approval by a
majority of Reven's stockholders. The closing of the merger
is expected to occur by the end of October, 2019, subject to
satisfaction of all closing conditions. Reven's existing loan
agreements with Arbor Agency Lending, LLC, an approved
seller/servicer for Federal Home Loan Mortgage Corporation, are
expected to remain outstanding following the closing of the
merger.
Keith Hall, SOR's Chief Executive
Officer, stated, "This acquisition further expands SOR's commitment
to the single-family rental business, which is an area of
significant potential growth. The asset class is a strong fit for
our investor base, and we look forward to exploring further
acquisitions."
Peter McMillan, SOR's Chairman of
the Board, added, "This transaction furthers our commitment to
corporate investments, particularly in other real estate investment
trusts. We see this as complementary to our traditional strengths
in property and debt investments, and a source of incremental
opportunity."
Chad Carpenter, Reven's Chairman
of the Board and Chief Executive Officer, stated, "We are delighted
to reach an agreement with SOR, which is the result of a
comprehensive strategic alternatives process conducted by our Board
of Directors. We are confident that this transaction, upon
closing, will deliver immediate and substantial cash value to our
stockholders."
Advisors
RBC Capital Markets, LLC served as financial advisor to Reven,
and Greenberg Traurig, LLP served as legal counsel to Reven.
DLA Piper LLP (US) served as legal counsel to SOR.
About KBS Strategic Opportunity REIT, Inc.
KBS Strategic Opportunity REIT is a non-traded Real Estate
Investment Trust (REIT) designed to provide stockholders attractive
total returns through the purchase of commercial real estate and
related investments that offer attractive risk-adjusted returns.
SOR invests across all real asset classes, including debt, equity,
and corporate investments, targeting both developed and less liquid
markets.
About Reven Housing REIT, Inc.
Reven Housing REIT, Inc. (NASDAQ: RVEN) engages in the
acquisition and ownership of portfolios of occupied single-family
rental properties in the United
States. Reven currently owns and operates 993 single family
rental properties in Alabama,
Florida, Georgia, Mississippi, Oklahoma, Tennessee and Texas.
For more information, please visit
http://www.revenhousingreit.com/.
Forward-Looking Statements
This press release includes forward-looking statements within
the meaning of Section 27A of the Securities Act, and Section 21E
of the Exchange Act. These forward-looking statements
include, but are not limited to, statements regarding the proposed
merger transaction between Reven, Parent and Merger Sub, the
financing of the proposed merger transaction, the expected timing
for the closing of the merger, the expected retention of Reven's
existing loan agreements, all statements regarding Reven's expected
future financial position, results of operations, cash flows,
dividends, financing plans, business strategy, budgets, capital
expenditures, competitive positions, growth opportunities, plans
and objectives of management, and statements containing words such
as "anticipate," "approximate," "believe," "plan," "estimate,"
"expect," "project," "could," "would," "should," "will," "intend,"
"may," "potential," "upside," and other similar expressions.
All statements in this press release that are not historical facts
are forward-looking statements that reflect the best judgment of
SOR and Reven based upon currently available information.
Such forward-looking statements are inherently uncertain, and
stockholders and other potential investors must recognize that
actual results may differ materially from the expectations of SOR
and Reven as a result of a variety of factors, including, without
limitation, those discussed below. Such forward-looking
statements are based upon management's current expectations and
include known and unknown risks, uncertainties and other factors,
many of which neither SOR nor Reven is able to predict or control,
that may cause its actual results, performance or plans to differ
materially from any future results, performance or plans expressed
or implied by such forward-looking statements. These statements
involve risks, uncertainties and other factors discussed below and
detailed from time to time in the filings with the SEC of SOR and
Reven.
Risks and uncertainties related to the proposed merger include,
but are not limited to, potential adverse reactions or changes to
business relationships resulting from the announcement or
completion of the merger, uncertainties as to the timing of the
merger, adverse effects on Reven's stock price resulting from the
announcement of the merger or the failure of the merger to be
completed, competitive responses to the announcement of the merger,
the risk that third-party approvals required for the consummation
of the merger are not obtained or are obtained subject to terms and
conditions that are not anticipated, litigation relating to the
merger, the inability to retain key personnel, and any changes in
general economic and/or industry-specific conditions.
In addition to the factors set forth above, other factors that
may affect the plans, results or stock price of Reven or SOR are
set forth in their most recent respective Annual Report on Form
10-K and in its subsequently filed respective reports on Forms 10-Q
and 8-K.
Many of these factors are beyond the control of SOR and
Reven. SOR and Reven each cautions investors that any
forward-looking statements made by it are not guarantees of future
performance. SOR and Reven each disclaims any obligation to
update any such factors or to announce publicly the results of any
revisions to any of the forward-looking statements to reflect
future events or developments.
Additional Information and Where to Find It
Reven will prepare and file with the Securities and Exchange
Commission (the "SEC") an Information Statement for its
stockholders containing the information with respect to the merger
specified in Schedule 14C promulgated under the Exchange Act and
describing the proposed merger and the other transactions
contemplated by the merger agreement. When completed, a
definitive Information Statement will be filed with the SEC and
mailed to Reven's stockholders. Investors are urged to
carefully read the Information Statement and any other relevant
documents in their entirety when they become available because they
will contain important information about the proposed merger and
the other transactions contemplated by the merger agreement.
You may obtain copies of all documents filed with the SEC regarding
proposed merger and the other transactions contemplated by the
merger agreement, free of charge, at the SEC's website,
http://www.sec.gov, or from Reven by directing a request by mail to
Reven Housing REIT, Inc., Attention: Corporate Secretary, 875
Prospect Street, Suite 304, La Jolla,
CA 92037, or by telephone to (858) 459-4000.
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SOURCE Reven Housing REIT, Inc.