Shareholders Approve $1.4B First Potomac Merger
First Potomac's shareholders voted Tuesday to approve the deal, in which Boston-based Government Properties Income Trust will acquire the Bethesda-based REIT, the Washington Business Journal reports.
There was some vocal opposition, with one shareholder filing a lawsuit against First Potomac last month alleging it did not provide enough information to investors ahead of the vote. But the deal was still approved by a wide margin.
Roughly 50 million shareholder votes were cast for the merger, with just 143,000 voting against it. Investors will receive about $11.15 per share from the deal.
While the merger received strong support, shareholders voted down a separate measure that would have given more than $20M in cash and equity grants to three First Potomac executives, including CEO Bob Milkovich. That arrangement was rejected by a vote of 30.7 million to 19.5 million, but the vote was nonbinding and contractual terms could still force the payments to be made. Milkovich and the other First Potomac executives will leave the company upon completion of the merger.
First Potomac's portfolio includes 39 properties totaling 6.5M SF, and it was 92.2% leased as of June. Upon completion of the merger, expected to be finalized in October, it will be combined with Government Properties' portfolio of 18M SF across 113 properties in 31 states.