Kennedy Wilson, an investment firm with $30B in real estate assets under management, has received an offer to buy out its shareholders and take the company private.
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The prospective buyer group includes the company’s CEO and chairman, William McMorrow, Toronto-based Fairfax Financial Holdings Ltd. and “other current senior executive officers of the company,” which together already own 31% of KW.
The group presented Beverly Hills-based Kennedy Wilson with a letter Tuesday, offering to buy the rest of its shareholders’ equity for $10.25 per share, which the letter said was a 38% premium to its Tuesday closing share price on the New York Stock Exchange.
The offer reportedly values the company at $1.5B.
The letter says the buyers can fund the offer through liquidity and that no financing is needed.
It says the proposal allows stockholders to “immediately realize liquidity and certainty of value for their investment at a compelling value” and that taking the company private would rid it of its obligations for public reporting — and the “associated expense and administrative burden” that comes with being a public company.
The acquisition offer comes as Kennedy Wilson is expanding its multifamily management, ownership and development portfolio through a $347M acquisition of Toll Brothers Apartment Living.
The deal, announced in September, was expected to close last month.
At the end of the second quarter, Kennedy Wilson had $30B of real estate assets under management, a 70% increase from 2021, McMorrow said on its second-quarter earnings call in August.
The CEO also said the company was focused on increasing its multifamily exposure from 65% to 80%. As part of that goal, it is attempting to grow the number of units it has an ownership interest in or is financing from around 70,000 to between 90,000 and 100,000 over the next three to four years, he said.
Kennedy Wilson has financed two large office-to-residential conversion projects in the D.C. area, and Managing Director Craig Lockard told Bisnow in September it is “aggressively pursuing” more deals.
Kennedy Wilson is scheduled to hold its third-quarter earnings call Thursday at 9 a.m. ET. The company's share price rose more than 30% Wednesday after the buyout offer.
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