WINNIPEG, MB, March 1, 2022 /CNW/ - Artis Real Estate Investment Trust ("Artis" or the "REIT") (TSX: AX.UN) announced today the closing of the previously announced plan of arrangement transaction (the "Arrangement"), pursuant to which all of the issued and outstanding units of Cominar Real Estate Investment Trust ("Cominar") were acquired for $11.75 per unit in cash by a consortium led by an affiliate of Canderel Management Inc., and including Artis, partnerships managed by Sandpiper Group, and FrontFour Capital Group LLC.

Artis Real Estate Investment Trust Logo (CNW Group/Artis Real Estate Investment Trust)

"This is a milestone transaction in the implementation of our Business Transformation Plan and is reflective of the nature of investment that we are pursuing to build long-term value for our unitholders," said Samir Manji, President and Chief Executive Officer of Artis. "Since announcing this transaction last October, our conviction in the intrinsic value of Cominar's real estate portfolio and the corresponding value creation we will achieve for our unitholders has only strengthened. At the same time, through the active collaboration we've had with our consortium partners, we have seen first-hand the valuable contribution each of our partners bring to the table." 

Artis contributed $212.0 million to the Arrangement, including $112.0 million to acquire common equity units (representing approximately 32.64% of the total common equity units in the newly formed entity) and $100.0 million to acquire junior preferred units that carry a distribution rate of 18.0% per annum. As part of the consideration, Artis contributed its existing Cominar units, which had a fair value of $13.4 million as at December 31, 2021. Sandpiper Group contributed $56.0 million to the Arrangement, representing 16.32% of the common equity, and Halcyon International Limited, a company controlled by Steven Joyce, contributed $20.0 million to the Arrangement, representing 5.83%. Together, Artis, Sandpiper Group and Halcyon International Limited control 54.79% of the total common equity units in the newly formed entity.

"This transaction, and other key initiatives completed last year, align with the long-term vision and strategy announced last March," said Ben Rodney, Chair of the Artis Board of Trustees. "The ability to strengthen our balance sheet and liquidity in a short period of time and then immediately harness some of that liquidity to acquire a significant stake in a portfolio, at a substantial discount to its intrinsic value, will produce strong NAV growth for Artis and its unitholders. This also validates the relationship Artis has with Sandpiper Group. Sandpiper provided the underwriting for this investment, which they had developed over several years, and it enabled Artis to move swiftly and confidently in our decision. We are very pleased with what we have achieved in our first year since presenting our new vision and strategy and we look forward to working with our management team in the execution of our 2022 plan."

Also under the Arrangement, certain of Cominar's office, retail and industrial assets were acquired by other parties not part of the consortium. 

The Arrangement was originally announced on October 24, 2021, and was approved by Cominar's unitholders at a special meeting held on December 21, 2021. A final order from the Superior Court of Québec in respect of the Plan of Arrangement was obtained on December 23, 2021.

On March 10, 2021, Artis announced a new vision and strategy for the REIT – to build a best-in-class asset management and investment platform focused on growing net asset value per unit and distributions for investors through debt repayment, return of capital and value investing in real estate. As part of this strategy, Artis committed to deploying capital into strategic investments in portfolio companies and concentrating its ownership in the highest and best return opportunities in an effort to maximize long-term value for unitholders.

Artis is a diversified Canadian real estate investment trust with a portfolio of industrial, office and retail properties in Canada and the United States. Artis' vision is to build a best-in-class asset management and investment platform focused on growing net asset value per unit and distributions for investors through debt repayment, return of capital and value investing in real estate.

Cautionary Statements 

This press release contains forward-looking statements. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, the words "expects", "anticipates", "intends", "estimates", "projects", "seeks", and similar expressions or variations of such words and phrases that state that certain actions, events or results ''may'', ''would'' or ''will'' occur or be achieved are intended to identify forward-looking statements. Particularly, statements regarding the terms and conditions of the Arrangement and Artis' participation therein, the timing of the Arrangement, Artis' return of capital and value investing strategies, building Artis into a best-in-class asset management and investment platform focused on value investing in real estate, the REIT's ability to execute its strategy, the REIT's ability to maximize long-term value and anticipated returns are forward-looking statements. Forward-looking statements are based on a number of factors and assumptions which have been used to develop such statements, but which may prove to be incorrect. Although Artis believes that the forward-looking statements in this press release are based on information and assumptions that are current, reasonable and complete, these statements are by their nature subject to a number of factors that could cause actual results to differ materially from management's expectations and plans as set forth in such forward-looking statements. For more information on the risks, uncertainties and assumptions that could cause the Artis' actual results to differ from current expectations, refer to the section entitled "Risk Factors" of Artis' Annual Information Form for the year ended December 31, 2020, as well as Artis' other public filings, available at www.sedar.com. Artis cannot assure investors that actual results will be consistent with any forward-looking statements and Artis assumes no obligation to update or revise such forward-looking statements to reflect actual events or new circumstances. All forward-looking statements contained in this press release are qualified by this cautionary statement.

SOURCE Artis Real Estate Investment Trust

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