New York – Private-equity firm Blackstone Group on Thursday raised its offer to buy Equity Office Properties Trust by 11 percent to $22.3 billion, or $54 per share in cash, topping a rival bid from Vornado Real ty Trust as it made the second-biggest private-equity buyout offer ever.
Including debt, the deal could be worth as much as $38 billion, given $16.49 billion in Equity Office debt reported as of Sept. 30. That valuation ranks it the largest-ever private-equity buyout bid, surpassing the 1988 takeover of RJR Nabisco Inc. by Kohlberg Kravis Roberts & Co., according to data from Dealogic.
Excluding debt, it is the second-largest after RJR Nabisco, which was valued at $25.1 billion, excluding debt.
The revised offer puts Blackstone, led by Stephen Schwarzman, in competition with Vornado chairman Steven Roth to buy the company built by real-estate mogul Sam Zell. Zell’s nickname is “Grave Dancer” for his affinity for buying distressed assets.
Shares of Equity Office finished at $54.90, up $2.20, on the New York Stock Exchange.
The successful bidder will ultimately gain control over what Zell has developed into the nation’s largest publicly traded owner and manager of office properties at a time when the commercial real-estate market remains strong.
