AIC and CAI are affiliated REITs that collectively have interests in 33 manufactured home communities with 6,300 developed home sites and 3,800 sites for expansion. Prior to the merger, AIC also managed and owned 27% of CAI. Seven years ago, CAI was spun off from AIC, which retained a 27% interest in the spin-off venture. The merger, pending court approval, will result in a new name: American Land Lease Inc., trading on the NYSE as ANL.
Bruce E. Moore, president and COO for AIC and CAI, says the merger makes sense "now that they are in the same business and use the same personnel. It made sense to combine two small, affiliated companies into a single better-capitalized company."
In connection with the merger, 3.5 million common CAI shares will be exchanged for $20.4 million in cash and the remaining 4.1 million of CAI common shares that are not owned by AIC will be exchanged for 1.7 million AIC common shares.
CAI shareholders electing to receive cash will receive $5.75 per share for 70% of their stock and 0.475 AIC shares for the balance of their holdings. The agreement was worked out when holders of 5 million CAI shares did a cash call in lieu of taking stock, exceeding the 3.5 million ceiling on a cash-for-stock swap.
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