No Increase In The $3.00/Share Tender Offer
Price Is Proposed
ABP Acquisition LLC, or ABP, today announced that its pending
tender offer for up to 10 million common shares of Five Star
Quality Care, Inc. (Nasdaq: FVE), or Five Star, has been increased
to be an offer for up to 18 million Five Star shares. The price of
the tender offer at $3.00/share remains unchanged.
ABP then made the following statement regarding the Thomas
Brothers:
“On October 13, 2016, William and Robert Thomas
(the ‘Thomas Brothers’) announced that they ‘intend’ to make a
competing offer to purchase up to 10 million Five Star shares at
$3.45/share. We believe the Thomas Brothers are unlikely to
complete such a tender offer for the following reasons, among
others:
“First, ABP has obtained waivers of certain
share ownership restrictions in Five Star’s governing documents
which limit ownership of Five Star shares to protect its tax
attributes and protect the REIT tax status of Five Star’s former
parent entity and Five Star’s largest landlord, Senior Housing
Properties Trust (Nasdaq: SNH). The Thomas Brothers made requests
for such waivers and their requests were not granted. See Five
Star’s Form 8-K filed with the SEC on October 27, 2016;
“Second, the Thomas Brothers’ October 13
announcement stated that they intend to seek ‘similar exceptions
and approvals’ to those obtained by ABP. Five Star and SNH
conditioned the approvals granted to ABP upon ABP’s agreeing to
standstill and lock up restrictions for up to 10 years. We do not
believe the Thomas Brothers will agree to similar covenants. In
fact, the Thomas Brothers have already begun the process necessary
to make nominations to Five Star’s Board;
“Third, the Thomas Brothers own a business
which competes with Five Star, Senior Star Management Company. In a
2015 meeting, the Thomas Brothers stated that they have no interest
to acquire Five Star. Rather, they stated that their interest in
Five Star is to acquire some of Five Star’s best senior living
communities at bargain basement prices. See Five Star Form 8-K
filed with the SEC on December 21, 2015; and
“Fourth, the Thomas Brothers have not filed
with the SEC the documents necessary to begin a tender offer.
Rather, the Thomas Brothers have only filed a press release
announcing what they ‘intend’. If, in fact, the Thomas Brothers
make the necessary SEC tender offer filing, we believe it will
include conditions that are unlikely to be satisfied.
“For these reasons, among others, we believe
the Thomas Brothers’ stated ‘intent’ will not result in a completed
tender offer. Rather, ABP believes the announcement made by the
Thomas Brothers is an obvious attempt to disrupt ABP’s pending cash
tender offer and to further the Thomas Brothers’ private interests
to acquire certain Five Star assets at bargain prices.”
The ABP tender offer expires at midnight, New York time, on
November 10, 2016. The ABP tender offer price of $3.00/share
represents a 57% premium to the unaffected closing price of Five
Star shares on September 30, 2016, the business day before the ABP
offer was publicly announced.
IMPORTANT INFORMATION ABOUT THE TENDER
OFFER
This press release is for informational purposes only and is not
an offer to purchase or a solicitation of an offer to sell shares,
nor is it a substitute for the tender offer materials that ABP
Acquisition LLC has filed with the U.S. Securities and Exchange
Commission, or the SEC. ABP Acquisition LLC has filed a Tender
Offer Statement on Schedule TO and Five Star has filed a
Solicitation/ Recommendation Statement on Schedule 14D-9 with the
SEC with respect to ABP’s tender offer, as each may be amended. THE
TENDER OFFER MATERIALS ON SCHEDULE TO (INCLUDING THE OFFER TO
PURCHASE, THE AMENDMENT AND SUPPLEMENT TO THE OFFER TO PURCHASE, A
RELATED LETTER OF TRANSMITTAL AND CERTAIN OTHER TENDER OFFER
DOCUMENTS) AND THE SOLICITATION/ RECOMMENDATION STATEMENT ON
SCHEDULE 14D-9 CONTAIN IMPORTANT INFORMATION. FIVE STAR
STOCKHOLDERS SHOULD READ THESE DOCUMENTS CAREFULLY BECAUSE THEY
CONTAIN IMPORTANT INFORMATION THAT HOLDERS OF FIVE STAR SECURITIES
SHOULD CONSIDER BEFORE MAKING ANY DECISION REGARDING TENDERING
THEIR SECURITIES. The Offer to Purchase, the Amendment and
Supplement to the Offer to Purchase, the related Letter of
Transmittal and certain other tender offer documents, as well as
the Solicitation/ Recommendation Statement, are available to all
holders of Five Star common stock at no expense to them. The tender
offer materials and the Solicitation/Recommendation Statement are
available for free at the SEC’s website at www.sec.gov. Copies of
the documents filed with the SEC by ABP Acquisition LLC also are
available free of charge by contacting Morrow Sodali Global LLC,
its information agent for the tender offer, at (800) 662-5200.
Five Star also files annual, quarterly and current reports and
other information with the SEC. Important information about Five
Star is contained in these filings. You may read and copy these
reports or other information filed by Five Star at the SEC public
reference room, 100 F Street, N.E., Washington DC. 20549. Five
Star’s filings with the SEC are also available for free at the
SEC’s website, www.sec.gov.
WARNING REGARDING FORWARD LOOKING
STATEMENTS
THIS PRESS RELEASE CONTAINS FORWARD LOOKING STATEMENTS WITHIN
THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
AND OTHER SECURITIES LAWS. WHENEVER ABP USES WORDS SUCH AS
“BELIEVES”, “INTENDS”, “EXPECTS”, “POTENTIAL”, “WILL”, “MAY”,
“SHOULD”, “ESTIMATES”, “ANTICIPATES” AND DERIVATIVES OR NEGATIVES
OF SUCH WORDS OR SIMILAR WORDS, ABP IS MAKING FORWARD LOOKING
STATEMENTS. ABP’S FORWARD LOOKING STATEMENTS IN THIS PRESS RELEASE
ARE BASED UPON ABP’S CURRENT BELIEFS AND EXPECTATIONS, BUT THESE
FORWARD LOOKING STATEMENTS ARE NOT GUARANTEED TO OCCUR AND, IN
FACT, MAY NOT OCCUR BECAUSE OF VARIOUS RISKS, REASONS OR
UNCERTAINTIES, INCLUDING SOME WHICH ARE BEYOND ABP’S CONTROL. FOR
EXAMPLE:
- THIS PRESS RELEASE STATES THAT ABP DOES
NOT BELIEVE THE THOMAS BROTHERS’ STATED INTENTION WILL RESULT IN A
COMPLETED TENDER OFFER. WHETHER THE THOMAS BROTHERS’ ALLEGED TENDER
OFFER IS COMPLETED WILL DEPEND UPON FUTURE ACTIONS TAKEN BY THE
THOMAS BROTHERS, BY THE FIVE STAR BOARD OF DIRECTORS, BY THE SNH
BOARD OF TRUSTEES AND BY FIVE STAR STOCKHOLDERS, ALL OF WHICH
ACTIONS ARE BEYOND ABP’S CONTROL.
- THIS PRESS RELEASE STATES THAT THE
THOMAS BROTHERS HAVE REQUESTED WAIVERS FROM THE SHARE OWNERSHIP
RESTRICTIONS IN FIVE STAR’S GOVERNING DOCUMENTS WHICH LIMIT
OWNERSHIP OF FIVE STAR SHARES AND THOSE REQUESTS HAVE NOT BEEN
GRANTED. HOWEVER, THE THOMAS BROTHERS MAY RENEW SUCH REQUESTS OR
TAKE OTHER ACTIONS IN THE FUTURE WHICH MAY ALLOW THE THOMAS
BROTHERS TO PURSUE A TENDER OFFER FOR FIVE STAR SHARES.
- THIS PRESS RELEASE STATES THAT ABP DOES
NOT BELIEVE THAT THE THOMAS BROTHERS WILL AGREE TO “SIMILAR
EXCEPTIONS AND APPROVALS” TO THOSE THAT ABP HAS ACCEPTED TO OBTAIN
NECESSARY WAIVERS OF THE SHARE OWNERSHIP LIMITATIONS IN FIVE STAR’S
CHARTER AND BYLAWS BECAUSE THE APPROVALS GRANTED TO ABP ARE
CONDITIONED ON STANDSTILL AND LOCK UP COVENANTS FOR UP TO 10 YEARS.
HOWEVER, DECISIONS BY THE THOMAS BROTHERS TO AGREE TO CONDITIONS
WHICH MAY BE REQUIRED BY FIVE STAR OR SNH ARE BEYOND ABP’S
CONTROL.
- THIS PRESS RELEASE STATES THAT THE
THOMAS BROTHERS HAVE NOT FILED WITH THE SEC THE DOCUMENTS NECESSARY
TO BEGIN A TENDER OFFER AND THAT ABP BELIEVES ANY SUCH FILINGS THAT
MAY BE MADE BY THE THOMAS BROTHERS MAY INCLUDE CONDITIONS WHICH ARE
UNLIKELY TO BE SATISFIED. THE THOMAS BROTHERS MAY MAKE THE REQUIRED
FILINGS WITH THE SEC AND ABP’S SPECULATION ABOUT SUCH FUTURE
FILINGS MAY BE WRONG.
- THIS PRESS RELEASE POINTS OUT THAT THE
THOMAS BROTHERS HAVE PREVIOUSLY STATED THAT THEY ARE INTERESTED TO
ACQUIRE CERTAIN FIVE STAR ASSETS AND NOT INTERESTED TO ACQUIRE FIVE
STAR. DECISIONS BY THE THOMAS BROTHERS TO CHANGE THEIR INTEREST IN
FIVE STAR OR ITS ASSETS ARE BEYOND ABP’S CONTROL.
- THIS PRESS RELEASE STATED THAT ABP HAS
INCREASED ITS OFFER TO PURCHASE UP TO 18 MILLION FIVE STAR SHARES.
POSSIBLE IMPLICATIONS OF THIS STATEMENT MAY BE THAT 18 MILLION
SHARES WILL BE PURCHASED AND THAT TENDERING SHAREHOLDERS MAY BE
ABLE TO SELL ALL THEIR SHARES. IN FACT, IF LESS THAN 18 MILLION
SHARES ARE TENDERED, ONLY THE LESSER TENDERED AMOUNT WILL BE
PURCHASED. ALSO, IF MORE THAN 18 MILLION SHARES ARE TENDERED,
SHARES WILL BE PURCHASED FROM EACH TENDERING STOCKHOLDER PRO RATA
TO THE TOTAL AMOUNT OF SHARES TENDERED.
FOR THESE REASONS, AMONG OTHERS, FIVE STAR STOCKHOLDERS SHOULD
NOT PLACE UNDUE RELIANCE UPON ABP’S FORWARD LOOKING STATEMENTS.
ALSO, EXCEPT AS MAY BE REQUIRED BY APPLICABLE LAW, ABP UNDERTAKES
NO OBLIGATION TO UPDATE ANY FORWARD LOOKING STATEMENT AS A RESULT
OF NEW INFORMATION, FUTURE DEVELOPMENTS OR OTHERWISE.
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version on businesswire.com: http://www.businesswire.com/news/home/20161028005178/en/
ABP Acquisition LLCTimothy A. Bonang, 617-796-8390