CapLease Sued Over $2.2 Billion American Realty Takeover

A CapLease Inc. shareholder sued to block the company’s proposed $2.2 billion sale to real-estate investment trust American Realty Capital Properties Inc., saying the price is too low.

American Realty, seeking to expand its holdings of single-tenant commercial properties, agreed to pay $8.50 a share for CapLease’s common stock, or about $755 million, plus the assumption of debt, according to a May 28 regulatory filing. That’s 20 percent higher than the May 24 closing price of $7.10. CapLease preferred shares will be converted into the right to receive $25 a share in cash plus accrued dividends.

Jacquelyn Mizani sued both companies in state Supreme Court in Manhattan yesterday, calling the transaction “grossly inadequate” to CapLease shareholders. She’s seeking to proceed on behalf of a class of CapLease investors.

CapLease, based in New York, owns real estate across the U.S. ranging from single-tenant office buildings to distribution centers. Its largest tenants include the federal government, Aon Corp. and Kroger Co., according to the regulatory filing. The acquisition, which should be completed in the third quarter, will add more than 70 properties to American Realty’s portfolio, bringing its total to about 800.

Brad Cohen, a spokesman for CapLease with ICR LLC, didn’t immediately respond to an e-mail seeking comment on the suit. American Realty didn’t immediately return a phone message left at its New York headquarters today seeking comment.

The case is Mizani v. CapLease Inc., 651986/2013, New York State Supreme Court, New York County (Manhattan).

To contact the reporter on this story: Chris Dolmetsch in New York State Supreme Court at cdolmetsch@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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