Boston, MA 04/29/2014 (wallstreetpr) – Real estate finance company, Northstar Reality Finance Corp. (NYSE:NRF), is sinking in the market by highs of 7.01% after refuting claims it is planning to merge with American Reality Capital Properties Inc. It was being reported from people with knowledge that American Reality was planning to table an offer of about $20 a share.
If American tables this bid, it will represent a 25% premium on Northstar Reality Finance Corp. (NYSE:NRF) closing price of $16.03 as of last week. This should essentially value the company at $6.5 billion. it is also being reported that talks between the two companies are still preliminary according to sources with inside information
Northstar Spinoff Plans
There is still no assurance that the deal will pass at the proposed purchase price considering the volatility that Northstar Reality Finance Corp. (NYSE:NRF) shares have been showing in the recent trading sessions. American reality on its part led Nicholas Scholasch is expected to push through with the acquisition considering it had grown at the back of an acquisition worth $67 million when it began back in 2011.
The purchase is expected to add to American Realty’s non-trade REIT fundraising and management business which it acquired with the purchase of Cole. This should be a good addition considering Northstar owns a range of single tenant real estate housing and healthcare buildings. Last year Northstar announced plans to spin off its asset management unit into a publicly company. Northstar has been building its healthcare real estate business an asset that should be attractive for American realty.
Northstar refutes Merger Talks
The company in a rejoinder has refuted suggestions it is in talks for a possible merger. This seems to be the catalyst behind the plummeting of its stock in the stock exchange. A statement from the company maintains that it might enter into negotiations with a view of ensuring shareholders value.
It awaits to be seen how things would turn out in the coming days or whether the company is only trying to divert attention from the merger rumors. Northstar Reality Finance Corp. (NYSE:NRF) commands a market value of $5.6 billion early half American Realty’s $10 billion
