MPG Office Trust, Los Angeles’ most celebrated office developers, will be coming to a close. The financially struggling firm just last month agreed to sell U.S. Bank Tower, the tallest building in the West, to foreign investors.
Brookfield will become play a major role in setting rents in downtown Los Angeles and the dominant operator of prime office space in the city’s financial core after MPG’s departure.
MPG was the best-known builder of top-flight office space in Southern California during the construction boom of the 1980s and 1990s which was founded by Robert F. Maguire in the 1960s. Maguire left the company once known as Maguire Thomas Properties in 2008.
Under terms of the deal that would still have to be approved by shareholders, holders of MPG’s common shares will receive $3.15 per share in cash at the closing of the merger. The per share price represents a 21% premium to MPG’s closing share price of $2.60 on Thursday.
MPG has about $2 billion in debt that Brookfield’s newly formed subsidiary would assume and offered to buy MPG’s outstanding preferred shares for $25 per share in cash.
Chief executive of MPG, David Weinstein said, “Following a lengthy and exhaustive search, we have found a strategic buyer who has the capital and the market presence to appreciate the potential long-term value of our assets.”
The merger is expected to close in the third quarter of this year.
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reporter
Park Sae-jin
swatchsjp@ajunews.com