W. P. Carey Inc. Reit · NYSE:WPC
W. P. Carey Inc. Reit — W. P. Carey — Merger or Acquisition (June 2018)
19 slides from W. P. Carey Inc. Reit's merger presentation, Jun 18, 2018
Slide 1: Transaction Overview
Transaction Overview 100% stock acquisition by W. P. Carey (NYSE: WPC) of CPA®: – 17 Global (CPA:17) Fixed exchange ratio of 0.160x shares of WPC common stock for each share of CPA:17 common stock Implied price of $10.72 per each share of CPA:17 common stock based on WPC’s closing price of $67.03 (1
Slide 2: Strategic Rationale and Transaction Benefits
Strategic Rationale and Transaction Benefits Further simplifies WPC’s business and accelerates its strategy to focus exclusively on net lease investing for its balance sheet Higher-multiple Real Estate segment is expected to generate approximately 96% of total pro forma AFFO (up from 83% currently)
Slide 3: More Valuable Earnings: AFFO by Segment
Real Estate Inv. Mgmt. AFFO by Segment Current (1) Pro Forma (2) Real Estate earnings are generally ascribed a higher multiple by investors given the long-term, recurring nature of the underlying income relative to finite Investment Management earnings Improved earnings mix results in a higher pro f
Slide 4: Significantly Increases Size, Scale and Prominence
Significantly Increases Size, Scale and Prominence Largest REITs in the MSCI US REIT index ($B) Largest Net Lease REITs by Equity Market Capitalization ($B) (2) Source: FactSet, SNL, Market data as of 6/15/18. Based on WPC stock price of $67.03 as of 6/15/18. Includes select net lease REITs with equ
Slide 5: Overview of CPA:17
Overview of CPA:17 CPA:17 is the largest fund advised by WPC and owns a high-quality, diversified, primarily net lease portfolio Net Lease Assets by Property Type (1) Industrial 15% Self-Storage 1% Other (2) 5% Warehouse 28% Office 28% Retail 23% Net Lease Assets by Geography (1) International 44% U
Slide 6: Combined Company Portfolio Overview
Combined Company Portfolio Overview Pro Forma 411 1,159 Number of Properties (1) 886 $379 $1,068 ABR ($MM) (2) $689 99.7% 99.7% Occupancy (%) 99.7% 11.5 years 10.4 years Weighted-Average Lease Term (2) 9.7 years 31.0% 28.8% % of Investment Grade Tenants (2) 27.6% 41.8% 25.3% Top 10 Tenant Concentrat
Slide 7: Geographic Diversification
Geographic Diversification Pro Forma Portfolio Diversification Consistent with WPC’s Current Portfolio Top 10 Tenants By Property Type Industrial 24% Warehouse 19% Office 26% Retail 19% Self-Storage 3% Other (1) 8% Note: Based on ABR as of 3/31/18. Please see revised ABR definition under “Disclosure
Slide 8: Extends Weighted-Average Lease Term and Lease Maturities
Extends Weighted-Average Lease Term and Lease Maturities Pro forma lease term of 10.4 years is among the highest for the net lease sector Lease Expiration Schedule (1) Weighted Average Lease Term (years) (1) Based on ABR as of 3/31/18. Please see revised ABR definition under “Disclosures” at the end
Slide 9: Transaction Enhances Credit Profile
Transaction Enhances Credit Profile Equity 62% Mortgage Debt (pro rata) 18% Senior Unsecured Notes 18% Unsecured Credit Facility 2% Market Capitalization (2) $10,919 Mortgage Debt, pro rata 3,167 Senior Unsecured Notes 3,148 Unsecured Credit Facility (3) 360 Total Pro Rata Debt $6,675 Less: Cash and
Slide 10: Current and Pro Forma Debt Maturity Schedule
Current Debt Maturity Schedule as of 3/31/18 (1) (2) (3) (3) Represents pro rata balloon payments at maturity and excludes fully amortizing loans. WPC’s unsecured revolver has initial maturity in 2021 with two six-month extension options. Reflects amount due at maturity, excluding unamortized discou
Slide 11: Continues WPC's History of Long-term Shareholder Value Creation
Continues WPC’s History of Long-term Shareholder Value Creation Total Shareholder Return Since CPA:15 Merger and REIT Conversion in 2012 Source: SNL; Market data as of 6/15/18. Represents transaction value at close. Net lease peers weighted by equity market capitalization. Includes LXP, STAG, SIR, G
Slide 12: Further simplifies WPC's business and accelerates net lease focus
Further simplifies WPC’s business and accelerates its strategy to focus exclusively on net lease investing for its balance sheet Higher multiple Real Estate segment is expected to generate approximately 96% of total pro forma AFFO, up from 83% currently (1) Real Estate segment is expected to contrib
Slide 13: A Compelling Transaction for W. P. Carey
A Compelling Transaction for W. P. Carey Accelerates execution of strategy to focus exclusively on net lease investing for its balance sheet Significantly increases earnings derived from “higher-multiple” recurring Real Estate revenues Enhances portfolio by increasing diversification and extending w
Slide 14: Cautionary Statement Concerning Forward-Looking Statements
Cautionary Statement Concerning Forward-Looking Statements Certain of the matters discussed in this communication constitute forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, both as amended by the Private Securities Litigation Refor
Slide 15: Additional Information and Where to Find it
Additional Information and Where to Find it This presentation shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration o
Slide 16: Disclosures
Disclosures The following non-GAAP financial measures are used in this presentation FFO and AFFO Due to certain unique operating characteristics of real estate companies, as discussed below, the National Association of Real Estate Investment Trusts, Inc., or NAREIT, an industry trade group, has prom
Slide 17: Disclosures (cont'd): MFFO
Disclosures (cont’d) The following non-GAAP financial measures are used in this presentation (cont’d) MFFO and MFFO, adjusted We define MFFO consistent with the IPA’s (formerly known as the Investment Program Association) Practice Guideline 2010-01, Supplemental Performance Measure for Publicly Regi
Slide 18: Disclosures (cont'd): EBITDA and Adjusted EBITDA
Disclosures (cont’d) The following non-GAAP financial measures are used in this presentation (cont’d) EBITDA and Adjusted EBITDA We believe that EBITDA is a useful supplemental measure to investors and analysts for assessing the performance of our business segments because (i) it removes the impact
Slide 19: Disclosures (cont'd)
Disclosures (cont'd) ‘The following non-GAAP financial measures are used in this presentation (cont'd) EBITDA and Adjusted EBITDA ‘We believe that EBITDA isa useful supplemental measure to investors and analyst for assessing the performance of our business segments because (i) it removes the impact