February 27, 2013 / 12:15 PM / in 5 years

CommonWealth REIT to proceed with share sale despite opposition

Feb 27 (Reuters) - Office building operator CommonWealth REIT said it will go ahead with a common share offering and debt tender offer despite opposition from several large investors.

Corvex Management, run by Carl Icahn associate Keith Meister, and Related Fund Management, the investment arm of Related Cos, reported a combined stake of nearly 10 percent in CommonWealth on Tuesday and said they will file a suit to block the offering.

CommonWealth shares jumped more than 50 percent on Tuesday after the investors said they were willing to pay $2.1 billion or more to acquire the REIT.

The shareholders called the debt repurchase and offering of 27 million shares announced on Monday “value destroying.”

A New York-based investment manager, Luxor Capital Group, which owns about 8 percent of CommonWealth, came out in support of Corvex and Related late on Tuesday and demanded that CommonWealth form an independent committee to explore strategic alternatives.

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