Ares Commercial Real Estate Corporation (ACRE) has reportedly entered into an agreement to buy Alliance Capital LLC, a real estate financial service firm owned by The Alliant Company LLC and the Alliant Inc, for around $62.8 million, according to a press statement.
Apparently, ACRE will pay the amount in a combination of cash and stock. Alliance Capital LLC and Alliant Inc will receive around 588,235 shares of ACRE, which are valued at around $9.9 million and a cash payment of around $52.9 million.
Alliant LLC has around 90 employees stationed in about 15 offices throughout the U.S. The transaction is expected to be completed in the second half of 2103. Once the company is acquired, it will operate as a wholly taxable separate Real Estate Investment Trust (REIT), which will be a subsidiary of ACRE.
"This highly strategic transaction with Alliant Capital LLC will enable ACRE to better meet the short- and long-term financing needs of multi-family owner/operators in an asset class that has performed well over the long-term, especially in the past five years. We expect that the transaction will benefit shareholders by being accretive to earnings as revenue synergies follow the advancements of scale," John Bartling, CEO of ACRE said in a press statement.
In the statement, ACRE also announced the appointment of Todd Schuster as Co-Chief Executive, who will be joining Bartling from June 1, 2013. Todd served as a board member before being appointed as Co-CEO for ACRE.
"We are delighted to have Todd's leadership in growing the ACRE platform. As a leading commercial real estate finance CEO, Todd's significant insights in running GSE and FHA/Ginnie Mae platforms will be invaluable to the success of this acquisition," Bartling added.
More recently, ACRE announced that its board of directors is authorizing a second quarter dividend of $0.25 per share of its common stock, which will be payable on July 18, 2013. They also announced their first quarter results stating that they had completed two major commitments worth $132.6 million.
Read more on the earnings report of ACRE, here.
