Glenborough to Be Acquired
For $1.9 Billion in Cash Deal

Glenborough Realty Trust Inc. agreed to be acquired by funds managed by Morgan Stanley for roughly $1.9 billion, the companies said Monday.

The buyout values San Mateo, Calif.-based Glenborough at $26 a share, representing an 8.2% premium over the Friday closing price of $24.03.

The real-estate investment trust said holders of its limited partnership units can opt to receive either $26 in cash, or common units in the surviving operating partnership similar to the terms of the existing common units, or a preferred unit in the surviving operating partnership.

The consideration to be paid by Morgan Stanley Real Estate includes repayment or assumption of Glenborough's existing debt and redemption of its Series A convertible preferred stock.

The deal is expected to close in the fourth quarter.

"Glenborough's high-quality office properties are located in some of the country's most desirable and supply-constrained office markets, such as Washington, D.C., and Northern and Southern California," said Michael Franco, managing director of Morgan Stanley Real Estate, in a statement.

Glenborough says it has a portfolio of 45 properties encompassing about eight million square feet as of June 30, including multi-tenant office properties in Washington, D.C., Southern California, Boston, Northern New Jersey and Northern California. The REIT, which went public in 1996, has been selling assets in an effort to focus on its core coastal markets and reduce debt.

Morgan Stanley Real Estate manages $50.9 billion in real estate.

Goldman, Sachs & Co. acted as a financial adviser to Glenborough's board, and law firms Morrison & Foerster and Venable served as legal counsel. New York-based Morgan Stanley acted as financial adviser to Morgan Stanley Real Estate, with Goodwin Procter and Paul Hastings Janofsky & Walker providing legal advice.

Shares of Glenborough gained 7.8% to $25.90 in morning trade, while Morgan Stanley were down less than 1% at $66.51.

Separately, Revenue Properties Co. said it signed a definitive merger agreement with Sizeler Property Investors Inc. to acquire Sizeler at $15.10 a share in cash.

The companies said the transaction is valued at about $324 million, noting that Revenue Properties will also assume debt of about $85 million. The acquisition is subject to approval by Sizeler stockholders and is expected to close in the fourth quarter.

Sizeler is a REIT that invests in retail and apartment properties in the southeastern U.S. Revenue Properties is a real-estate company engaged in the acquisition, development and ownership of income-producing properties in Canada.

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