06:13 AM EDT, 10/29/2024 (MT Newswires) -- FC Private Equity Realty Management Corp. and Telsec Property Corporation overnight Monday formally commenced their offer to acquire up to 1,296,316 participating trust units of Melcor Real Estate Investment Trust (MR-UN.TO) from holders thereof other than Melcor Developments Ltd. ( MODVF ) and any related party of Melcor REIT or Melcor Developments ( MODVF ) at a price of $4.95 per trust unit, payable in cash.

A statement noted the tender offer is not a formal or exempt take-over bid under Canadian securities laws and regulations and is limited to a maximum of 1,296,316 trust units.

Among highlights, the offerors will purchase up to such a number of trust units on a rolling "first come, first served" basis.

According to the statement, the purpose of the tender offer is to defeat the take under offer and is not an endorsement of its price. The offerors -- who own or control approximately 12.2% of the issued and outstanding voting units of Melcor REIT -- intend to vote AGAINST the take under offer as proposed on its current terms and block it.

It said minority unitholders who wish to tender to the take under offer have the ability to accelerate the monetization of their trust units, regardless of the outcome of the Special Meeting, by tendering to the tender offer.

Firm Capital and Telsec said they are in no way recommending the $4.95 per trust unit price being offered to minority unitholders, but are providing an immediate opportunity to liquidate ownership in Melcor REIT without requiring, or waiting for, unitholder approval for the take under offer. "We expect the Melcor REIT board to recommend against the Tender Offer. Minority Unitholders should be skeptical of any recommendation by the Melcor REIT board given the substantially undervalued bid and flawed process they have overseen."