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Columbia Equity Goes Private in $502M Deal

WASHINGTON, DC- JPMorgan Asset Management will pay $19 per share and assume $213 million of Columbia's debt when the transaction closes in 2007.

By Erika Morphy | Updated on November 06, 2006

WASHINGTON, DC-A subsidiary of JPMorgan Asset Management’s Special Situation Property Fund (SSPF) is buying out all of Columbia Equity Trust Inc.’s outstanding shares as it takes the Washington REIT private in an all cash transaction. According to an announcement the two firms made this morning, SSPF will pay $19 per share. The acquisition is valued at approximately $502 million, including the assumption of Columbia’s debt of approximately $213 million.

Columbia principals Oliver Carr, chairman, president and CEO, and John Schissel, executive vice president and CFO, will reinvest 25% or more of their current equity in the company into the new entity when the transaction is complete. The two will also enter into new employment agreements with the JPMorgan Asset Management subsidiary that will replace their current agreements. The deal is expected to close during the first quarter 2007. Columbia’s stockholders still need to approve the transaction.

It is likely they will, given the value the transaction is expected to deliver. Stakeholders that bought into Columbia’s IPO last year will reap a return north of 31%, Mark Decker, vice president with investment banking firm RW Baird in Northern Virginia, notes. “That is exceptional for a 16 month investment,” he tells GlobeSt.com.

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