Michael DeMarco, CEO of Mack-Cali Realty Corp.
JERSEY CITY, NJ—Mack-Cali Realty Corp., in response to criticism leveled last week by dissident shareholder group Bow Street LLC, stated that it is committed to maximizing shareholder value and its Board is open to acquisition proposals.
Mack-Cali Realty charged that Bow Street in last week's letter to shareholders that called for the removal of Mack-Cali CEO Michael DeMarco, similar to its 2019 proxy contest, "intends to engage in a campaign based on deception, falsehoods and other dishonest tactics to advance its self-serving agenda."
Mack-Cali went further stating that Bow Street's letter included "outright lies, about the company, its Board of Directors and management team in an attempt to conceal the true objective of its proxy contest—Bow Street's desire to acquire control of the Mack-Cali Board in order to force a sale of the company at any price."
The REIT noted that after its annual meeting and based on the recommendations of the Shareholder Value Committee and its financial advisors, the Mack-Cali Board determined to sell the company's entire suburban office portfolio and use the proceeds to pay down the company's corporate level, unsecured debt. The Board also determined to form a new Special Committee to oversee management in evaluating any acquisition proposals while continuing to explore ways to maximize stockholder value.
Mack-Cali also focused on criticism leveled by Bow Street in connection with an acquisition offer by Rizk Ventures in December 2019. Specifically, the company termed Rizk Ventures' proposal was "an illusory offer from a party that did not have the financial wherewithal to complete a potential transaction, much like the self-interested proposal submitted by Bow Street prior to launching its 2019 proxy contest. Moreover, the company believes that Rizk Ventures made its offer at the behest of, and in consultation with, Bow Street as part of Bow Street's strategy designed to put the company "in play" and force a precipitous sale process."
The company states that to date it has only received an acquisition offer from Risk Ventures.
"The Mack-Cali Board has repeatedly stated that it is open to all alternatives to maximize stockholder value, including a potential strategic transaction, and will consider all credible offers. In fact, the Board has formed the Special Committee to oversee management in reviewing any acquisition proposals that may be received by the company. However, the Board would not support a transaction that would shortchange Mack-Cali stockholders and prevent them from realizing the full value potential of their investment in the company."
Going forward, Mack-Cali's Board states it will start a strategic process after it executes on its current strategy for optimizing the company's asset portfolio, including the substantial completion of the suburban office sale and the Special Committee will assist the Board and management in evaluating any acquisition proposals or inquiries that may be received from any interested parties.
The company did reveal that its Special Committee recently met with representatives of potential bidder to discuss the possibility of a strategic transaction.
"While no offer was presented or discussed at the meeting, representatives of 'Party A' expressed a continued interest in a potential transaction with the company. Although Party A's representatives indicated that, given the current state of the stock and credit markets, an offer would not be feasible at this time, they indicated that, as the markets stabilize, Party A would revisit the possibility of making a proposal," Mack-Cali stated.
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John Jordan
John Jordan is a veteran journalist with 36 years of print and digital media experience.
