Equity Office Reaffirms
Support for Blackstone's Bid

Equity Office Properties Trust said its board of trustees has unanimously voted to reaffirm its recommendation of the proposed $54-a-share all-cash acquisition by affiliates of the Blackstone Group.

The Chicago-based real estate investment trust said the decision was made after deliberations with its financial and legal advisors regarding the revised offer it received Thursday from Vornado Realty Trust. Vornado offered $31 in cash and $25 in stock to acquire Equity Office. The stock component has a collar that guarantees the $56 pricing as long as Vornado's share price remains between $115 and $135 a share.

Equity Office said it would likely take four to six months to close the Vornado transaction, due to a requirement for a Vornado shareholder vote and the potential for Securities and Exchange Commission review.

Given the delay, the board said it has been advised that the net present value of the Vornado offer is between $54.28 and $54.88 a share, and it determined the value of the offer fails to adequately compensate Equity Office shareholders for the increased risk.

The board said the Blackstone transaction has "certainty of value and virtual certainty of closing in the immediate future." A special meeting of shareholders to vote on the Blackstone deal is scheduled for Feb. 5 but is expected to be adjourned until Feb. 7 to give shareholders time to review and consider supplemental proxy materials.

If approved, the Blackstone transaction would close on or about Feb. 9.

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