Gramercy Property Trust (NYSE: GPT) is having a great start in the trading session this morning after announcing that it has entered into a definitive agreement to be acquired. The agreement includes a strong premium, which obviously excited investors. So, we’re seeing some seriously positive movement in the stock. Today, we’ll talk about:
- The news;
- what we’re seeing from the stock;
- and what we’ll be watching for with regard to GPT ahead.
GPT Heads For The Top On Acquisition News
As mentioned above, Gramercy Property Trust is having an incredibly strong start to the trading session this morning after the company announced that it has entered a definitive agreement to be acquired. In a press release issued early this morning, the company announced that it entered into an agreement with affiliates of Blackstone Real Estate Partners. Under the terms of the agreement, Blackstone will acquire GPT.
In the press release, the company announced that the acquisition will take place at a price of $27.50 per share. This brings the total value of the transaction to $7.6 billion. At that price, Blackstone is paying a premium of 23% over the 30-day volume-weighted average price per share ending on May 4th and a premium of 15% over the stock’s closing price on May 4th. In the release, it was announced that the boards of both companies have unanimously approved the transaction. In a statement, Gordon Dugan, Trustee and CEO at GPT, had the following to offer:
I speak for Ben Harris, Nick Pell and the entire team at Gramercy to say that we are very pleased to enter into this transaction. We believe this validates the quality of the portfolio and platform that we have built. Entering into this transaction with Blackstone fulfills our Board of Trustees’ mission to maximize shareholder value.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dabble in the market is that the news causes moves. In this particular case, the news surrounding Gramercy Property Trust proved to be overwhelmingly positive. After all, any time an acquisition happens at such a strong premium, investors see an immediate return of value. So, it’s no surprise that excited investors are pushing the stock for the top today. As is almost always the case, our partners at Trade Ideas were the first to alert us to the gains. At the moment (9:50), GPT is trading at $27.52 per share after a gain of $3.70 per share or 15.53% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on GPT. In particular, we’re interested in following the story surrounding the acquisition. While the transaction has been approved by both companies, it is still subject to customary closing conditions as well as regulatory approval. Nonetheless, we see no reason the transaction shouldn’t be completed and we’ll follow the story closely, bringing the news to you as it breaks!
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