GE Real Estate today announced it has reached an agreement through its U.K. affiliate, GE Capital Corporation (Property Company Investments) Limited, to acquire Benchmark Group, PLC, the London property investment firm.
After entering exclusive negotiations with Benchmark in early March, GE Real Estate received commitments representing 72 percent of the equity from the firm’s two largest shareholders before finalizing its offer. The deal also received the unanimous recommendation of Benchmark’s Independent Directors. The terms of this agreement include a cash offer to shareholders worth approximately $820 million. No external financing will be required to close this deal. The Scheme of Arrangement documents will be submitted as required by U.K. law to the court in late April 2004. Subject to its approval, the acquisition is expected to become effective July 1, 2004.
“Benchmark offers a good opportunity to increase our exposure to the West End market of London by acquiring a West End property portfolio which has been developed and managed by a respected specialist team. It is also highly complementary to our existing portfolio,” says Alec Burger, GE Real Estate U.K. Managing Director. Specifically, the acquisition represents the addition of 1.7 million square feet of West End office and retail space to the existing U.K. portfolio.
“We are excited by the opportunity this acquisition represents to increase our direct investment in U.K. property,” says GE Capital Europe President, Charles Alexander. It is felt that the combination of GE Real Estate’s financial strength and asset management skills and Benchmark’s specialist knowledge and expertise will further fortify GE Real Estate’s long term commitment to the very important U.K. property market.
Benchmark was founded in 1996 by Nigel Kempner, the firm’s current chief executive. It is expected that an agreement will be reached shortly to secure Kempner and his team’s ongoing involvement in the properties’ strategic management and development beyond the finalization of the acquisition.
