Cali Realty Corporation Receives Shareholder Approval and Completes Merger with the Mack Company and Patriot American Office Group
12/12/1997 Category: Acquisitions
Board Restructured, New Independent Directors Appointed
Company Renamed Mack-Cali Realty Corporation
CRANFORD, NJ--December 12, 1997--Cali Realty Corporation (NYSE:CLI) today announced, following a special meeting of shareholders, that it received shareholder approval of its merger with The Mack Company and Patriot American Office Group. Immediately following approval, the Company completed the $1.2 billion transaction, which was structured as an acquisition. The combined company, renamed Mack-Cali Realty Corporation, ranks as one of the country's largest REITs with a total market capitalization of approximately $3.4 billion.
Commenting on today's announcement, Thomas A. Rizk, Chief Executive Officer of Mack-Cali, said, "Today represents a new day for our Company. This merger presents us with an unprecedented opportunity to capitalize on our strong collective relationships, while strengthening our super-regional status."
William Mack, who was appointed a Director and Chairman of the Executive Committee of Mack-Cali, stated, "Today, we are excited to officially join with Cali, whose great success has paralleled our own. My brothers and I strongly believe the combined Mack-Cali organization is well positioned to become one of the preeminent companies in the real estate industry."
Highlights of the transaction include:
- The addition of 54 office properties totaling 9.2 million square feet, primarily in the Northeast and Southwest, for a combined portfolio of 187 properties totaling approximately 21.6 million square feet of office, office/flex and industrial/warehouse space, located in 10 states.
- A strengthened management team, combining the talents of well-respected real estate leaders William Mack, Thomas A. Rizk, Mitchell Hersh, and John J. Cali.
- The addition of 1,000 tenants for a combined tenant base of approximately 2,200 businesses.
- A dominant presence in the Northeast, with over 17 million square feet of space, and strategic beachheads in the Southwest, with approximately 3 million square feet in Texas and Arizona.
- An increased market capitalization, to $3.4 billion, ranking Mack-Cali as one of the country's largest REITs.
- Enhanced opportunities for growth due to geographic diversity, an improved network of relationships, and the increased size and scope of the Company.
In keeping with its philosophy of full integration before completing transactions, the Company reported that property services and accounting and information management systems have been fully integrated. Mitchell Hersh, the new President and Chief Operating Officer of Mack-Cali, commented, "Since the announcement of this transaction, we have stressed the importance of full and complete integration. I personally have spent the last several months working closely with Tom Rizk and his team to ensure a smooth transition so that we are fully prepared to hit the ground running. We have already targeted several exciting transactions that will demonstrate Mack-Cali's strategy of capitalizing on our combined network of relationships and growth opportunities."
Company Restructures Board
In conjunction with the completion of the merger, the Company also announced that it has restructured its board of directors, which now consists of 13 members. The new Mack-Cali board consists of two Cali representatives: John J. Cali, who remains as Chairman, and Thomas A. Rizk; Robert F. Weinberg, a representative from the Robert Martin Company, which merged into Cali in January 1997; three Mack representatives: William Mack, Earle Mack and Mitchell Hersh; three of Cali's current independent board members: Brendan T. Byrne, Alan G. Philibosian and Irvin D. Reid; and four new independent board members: Martin D. Gruss, Senior Partner of Gruss & Co., Jeffrey B. Lane, Vice Chairman of the Travelers Group, Paul A. Nussbaum, Chairman and Chief Executive Officer of Patriot American Hospitality, and Vincent Tese, Chairman of Wireless Cable International.
Commenting on the new board, Mr. Rizk added, "We're very pleased about our new board additions and welcome their wealth of expertise and business acumen to the Mack-Cali team."
Mack-Cali Realty Corporation is a fully integrated, self-administered, self-managed real estate investment trust (REIT) providing leasing, management, acquisition, development, construction and tenant-related services for its portfolio. The Company owns 187 properties, primarily office and office/flex buildings, totaling approximately 21.6 million square feet. The properties are located in 10 states, primarily in the Northeast and Southwest.