Diversified Healthcare Trust · NASDAQ:DHC
Diversified Healthcare Trust — Proxy Contest (August 2023)
67 slides from Diversified Healthcare Trust's proxy contest presentation, Aug 2, 2023
Slide 1: The Case for Voting AGAINST the Proposed DHC/OPI Merger
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Slide 2: Disclaimer
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Slide 3: Table of Contents
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Slide 4: Executive Summary
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Slide 5: Key Points: DHC Can Thrive as an Independent Company
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Slide 6: Flat Footed LLC and Our Investment in DHC
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Slide 7: Proposed Merger
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Slide 8: Diversified Healthcare Trust
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Slide 9: Office Properties Income Trust
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Slide 10: Merging These Two REITs Is Illogical
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Slide 11: The Proposed Merger Materially Undervalues DHC
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Slide 12: The Proposed Merger Materially Undervalues DHC
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Slide 13: Market Reacted Negatively to the Proposed Merger
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Slide 14: Other Investors Agree with Flat Footed's Position
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Slide 15: The Deal's Deeply Flawed Process
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Slide 16: OPI and RMR Benefit at Expense of DHC Shareholders
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Slide 17: DHC Can Thrive as an Independent Company
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Slide 18: Superior Paths Forward: Targeted Non-Core Asset Sales
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Slide 19: Superior Paths Forward: Capital Raising
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Slide 20: The Proposed Merger Materially Undervalues DHC
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Slide 21: Deal Price Is Materially Below Numerous Alternative Valuations
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Slide 22: The Proposed Merger Materially Undervalues DHC
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Slide 23: OPI Expert Valuation for DHC
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Slide 24: FFO Sum of the Parts for DHC
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Slide 25: Prior Bid from May: Cash Bid for DHC
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Slide 26: Mr. Portnoy's Purchase of DHC Shares
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Slide 27: Current Trading Prices for DHC
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Slide 28: And Yet DHC Wants Investors to Accept a Discount
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Slide 29: DHC Is Well Positioned to Capitalize on Senior Housing Rebound
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Slide 30: DHC's Own Earnings Projections Are Driven by SHOP Assets
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Slide 31: BofA Undervalued DHC by Focusing on Depressed EBITDA
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Slide 32: Merger Based on Artificially Inflated Value for OPI
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Slide 33: OPI Is a Troubled, Over-Levered Office Property REIT
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Slide 34: Billions in OPI Bonds Are Due in Next Months
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Slide 35: BofA Overvalued OPI Using Aggressive Discount Rates
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Slide 36: BofA Overvalued OPI by Using Misleading Transaction Comps
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Slide 37: JPMorgan Indicated a More Appropriate Exchange Ratio
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Slide 38: The Process Was Deeply Flawed
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Slide 39: The Process Was Deeply Flawed
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Slide 40: The RMR Group
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Slide 41: RMR Perversely Incentivized as External Manager
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Slide 42: RMR's Questionable Management Contracts Fee Structure
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Slide 43: RMR Collected Billions in Fees Despite Incinerating Value
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Slide 44: Magnitude of Interlocks at RMR Likely Led to Flawed Process
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Slide 45: RMR's Recent Self-Serving Deals
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Slide 46: This Series of Events Does Not Make Sense
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Slide 47: RMR Orchestrated a Deal That Hurts DHC
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Slide 48: RMR Orchestrated a Deal That Benefits OPI and RMR
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Slide 49: Is Bank of America a Truly Independent Advisor for DHC?
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Slide 50: BofA's Opinion Undervalued DHC and Overvalued OPI
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Slide 51: Dubious Act: Mr. Portnoy's Aleris Life Deal
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Slide 52: Dubious Act: Financial Strength to Fear Mongering
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Slide 53: Dubious Act: Financial Strength to Fear Mongering
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Slide 54: Dubious Act: RMR's Own Investor Presentation Undermines Going Concern
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Slide 55: Dubious Act: Mr. Portnoy's Rapid Purchases of DHC Stock
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Slide 56: Dubious Act: New Details Disclosed in Recent Filings
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Slide 57: Dubious Act: New Management Agreement and Risk Factors
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Slide 58: Dubious Act: Sandbagging on Costs
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Slide 59: Superior Alternatives for DHC
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Slide 60: Superior Alternatives for DHC
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Slide 61: Realize Full Potential of SHOP
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Slide 62: Step Align: Capital Spending with Business Cash Flow
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Slide 63: Step Sell: Non-Core Assets to Realize Value and Improve Liquidity
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Slide 64: Step Address Any Remaining Liquidity Needs
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Slide 65: Vote the GOLD Proxy Card to Save DHC
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Slide 66: Appendix
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Slide 67: FFO Sum of the Parts
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