ARC Healthcare Trust III Declares First Net Asset Value and Shareholder Consideration for Merger
The board of American Realty Capital Healthcare Trust III Inc., a publicly registered non-traded REIT sponsored by AR Global, approved a $17.64 net asset value per share of the company’s common stock, according to a filing with the Securities and Exchange Commission.
As previously reported by AltsWire, affiliated non-traded REIT Healthcare Trust Inc. agreed to purchase ARC Healthcare Trust III’s 19 properties for approximately $120 million. Shareholders will vote on the asset sale as well as the board-approved plan of liquidation at the annual meeting which is not yet scheduled.
The board previously adopted valuation guidelines to determine the NAV per share, where an independent valuation firm would appraise the company’s properties in accordance with Investment Program Association guidelines.
Rather than seek third-party appraisals, the ARC Healthcare III board decided to calculate the NAV per share based on the negotiated value attributed to the properties under the Healthcare Trust purchase agreement. The board also considered the estimated costs and expenses of closing the 19-property sale and implementing the plan of liquidation.
American Realty Capital Healthcare III Advisors, the REIT’s advisor, also prepared an estimated range of the net proceeds from the asset sale that may be available for distribution to stockholders. The resulting range of cash consideration to stockholders is between $17.49 to $17.64 per share.
The filing noted conflicts of interest inherent in the proposed transaction and plan of liquidation. The advisors of ARC Healthcare Trust III and Healthcare Trust are indirectly owned and controlled by AR Global Investments. Edward Weil, Jr., the executive chairman of the board, is also a member of the board of directors of Healthcare Trust. Weil owns a non-controlling interest in the parent of AR Global and is also the chief executive officer of AR Global. In addition, ARC Healthcare Trust III, Healthcare Trust, and the two REITs’ advisors have the same executive officers.
ARC Healthcare III will stop paying regular distributions to stockholders after the July distribution payment, which is scheduled for August 8th.
