Influential proxy firm ISS recommended "cautionary support" for Healthcare Realty Trust's ( NYSE: HR ) planned acquisition of medical REIT Healthcare Trust of America ( NYSE: HTA ).
ISS recommended "cautionary support" for the deal at a shareholder vote on July 15, according to a Reuters report , which cited an ISS report from Friday, which was confirmed by HR on Monday.
ISS said that "if management can replicate its past achievements, the deal will create more value for them than the status quo standalone plan,'' according to a statement from Healthcare Realty.
The ISS recommendation comes as investors have been disappointed by the deal since it was announced in February and some including activist Jonathan Litt reportedly plan to vote against it.
Last month Litt argued that Healthcare Realty ( HR ) would be better served by taking a ~$5 billion buyout from Welltower Inc. ( NYSE: WELL ), an offer that was reported by the WSJ in early May.
Healthcare Trust ( HTA ) disclosed in a regulatory filing in May that there were other potential suitors for Healthcare Realty ( HR ) including an unidentified "Party F," which was Welltower ( WELL ), according to the WSJ. The nonbinding offer was subject to due diligence, that WELL was prepared to do quickly.
Healthcare Realty ( HR ) and Healthcare Trust of America ( HTA ) in February agreed to a $18B deal that brings together two of the largest owners of medical office buildings. The transaction, which was structured as a reverse merger in which HTA will be the corporate successor, is e xpected to be completed in Q3 .
HTA announced in November that it was exploring options, including a potential sale , after activist Elliott Management had been pressuring the company to sell itself.
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Proxy adviser ISS recommends cautionary support for Healthcare Realty/Healthcare Trust of America deal