C-III Capital Partners to Acquire Resource America (REXI) in ~$207M Deal

May 23, 2016 7:36 AM EDT

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Resource America, Inc. (NASDAQ: REXI) announced today that it has entered into a definitive agreement to be acquired by C-III Capital Partners LLC ("C-III"), a commercial real estate services company engaged in a broad range of activities, including primary and special loan servicing, loan origination, fund management, CDO management, principal investment, investment sales and multifamily property management. Under the terms of the agreement, Resource America stockholders will receive $9.78 per share in cash, or a total of approximately $ 207 million.

The agreement was unanimously approved by Resource America's Board of Directors following a comprehensive review of strategic and financial alternatives that the Company announced in January, 2016. The price per share represents a premium of over 128% from REXI's closing price on January 28, 2016, the day before it announced it would be reviewing strategic alternatives and a 51% premium over its closing price on May 20, 2016.

The addition of Resource America's asset management business to C-III's diverse suite of commercial real estate services will create a broad platform of products directed to retail and institutional investors. Resource America is the external manager of one publicly traded REIT, four non-traded REITS and two other registered investment companies and focuses on capital-raising activities through the independent broker-dealer network. C-III Capital Partners currently manages $3.8 billion on behalf of institutional investors in both debt and equity funds, a separate account and several structured product vehicles, including CRE-CDOs and ReREMICs. Its mortgage origination business has originated over $4.5 billion of commercial real estate loans since 2010. C-III Capital Partners is also one of the largest special and primary loan servicers in the United States, responsible for over 100 CMBS trusts comprising more than $100 billion of commercial real estate loans. The combined company will manage over $25 billion of gross assets, and own and/or manage over 70,000 apartment units across the U.S.

"We are very pleased with this transaction, which we believe provides excellent value to our shareholders and positions the businesses that we have created for further growth," said Jonathan Z. Cohen, President and CEO of Resource America. "Having undertaken a thorough strategic review, during which we evaluated a wide variety of options, the board has unanimously concluded that partnering with C-III is the best way to maximize value. This transaction will provide our stockholders with significant and immediate cash value. C-III is a highly regarded real estate services and investment management organization with outstanding leadership, deep commercial real estate expertise and a management team, led by Andrew Farkas, that has a 30-year track record of acquiring and enhancing businesses and helping them flourish. This transaction should enable Resource America to focus on reaching a new level of excellence, which will benefit our employees, customers and partners."

Edward E. Cohen, Chairman of Resource America since 1988, said, "I am very pleased that we are aligning with a strong, visionary and experienced group of high competence and achievement. We are achieving excellent value for our shareholders, providing a dynamic arena for our employees to grow Resource America's businesses and will enable us to continue to offer outstanding investment products in various public, non-traded and private vehicles."

Andrew L. Farkas, Chairman and CEO of C-III Capital Partners, said, "This transaction is a significant milestone for C-III. Since inception, we have been acutely focused on building and strengthening our industry position as a premier commercial real estate services and investment management firm. The addition of Resource America's businesses further diversifies our platform and enables us to become an even broader and more robust full-service provider of commercial real estate debt and equity solutions, spanning loan servicing and origination, fund management, property management, brokerage and other services. We look forward to partnering with Resource America's businesses and working with them to drive strong results across our combined platform as we embark on this next chapter of our growth."

C-III intends to retain the leadership and staff of Resource America's asset management businesses. The transaction, which is expected to close late in the third quarter or early in the fourth quarter of 2016, is subject to approval by Resource America stockholders, regulatory approvals and other customary closing conditions. The acquisition is not subject to any financing conditions.

Evercore has served as exclusive financial advisors to Resource America, and Wachtell, Lipton, Rosen & Katz has served as Resource America's legal advisors. Proskauer Rose LLP has served as C-III's legal advisors.



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