American Realty Capital Properties has increased its bid to buy Cole Credit Properties to $6.7 billion from its initial $5.7 billion offer. The new amount adds up to around $9.7 billion, inclusive of debts.
According to Fox Business, American Realty raised the bid to lure Cole Credit into agreeing to the deal. Cole Credit , on its part wants to acquire Cole Holdings and independently list itself on the New York Exchange.
In its new bid, American Realty offered $12.50 for each share of Cole Credit. In a letter to Bloomberg, American Realty stated:
"The proposal is a full and fair offer and well within the valuation you ascribed to CCPT III and Cole Holdings in your March 25 filing, but without all the attendant risks of a proposed listing on uncertain terms and timing."
American Realty had offered to buy 100 percent of Cole Credit's outstanding common shares for around $12 per share or 0.80 units of its own stock for each Cole Credit share. The total value of the deal including debt would amount to around $9 billion. It had also sent a letter to Cole Credit asking them to call off their plan to buy Cole Holdings for around $20 million, change its name to Cole Real Estate Investments and list it on the New York Stock Exchange.
However, Cole Credit declined the offer stating that the bid was not in the best interests of its shareholders and it would pursue buying Cole Holdings. It also wrote in a separate letter to its business partners that American Realty's offer was misleading and was not meant for 'serious consideration'. It also mentioned that the bid instead appeared to disrupt business for Cole Credit and Cole Holdings, both.
American Realty then said that it was preparing an official response and has now increased its offer.