Sutter Capital Announces Offer to Acquire IOT for $25 Per Share, Discloses Per Share Valuation Provided by BCM
SAN FRANCISCO, Oct. 30 /PRNewswire/ -- Sutter Capital Management, LLC (``Sutter'') today announced that it has offered to acquire all the outstanding common stock of Income Opportunity Realty Investors (Amex: IOT - news) for $25 per share. Payment would be in the form of 10 year, 8% Senior Notes. The Notes would be secured by all capital stock of IOT, and would be subordinated only to IOT's existing indebtedness.
Sutter further disclosed that it and its affiliates collectively own 35,000 shares of IOT, or 2.4% of the outstanding common stock of IOT. Sutter also disclosed that it is in possession of materials provided to it by Basic Capital Management (``BCM''), IOT's Advisor, that indicate BCM's internal valuation of IOT was $31.73 per share in 1999. BCM also provided to Sutter a valuation by Houlihan, Lokey, Howard and Zukin which concluded, using BCM internal financials, that IOT's assets were worth between $96-$105 million, leaving equity of $36-$45 million, implying a value for IOT common stock of between $25-$31 per share in 1999. Sutter notes that the net operating income generated by IOT's properties have generally increased since that time, indicating that it's properties may have increased in value.
Sutter's offer is subject to certain terms and conditions customary to transactions of this nature. The offer was made via a letter from Robert E. Dixon, President of Sutter, to Karl Blaha, President of IOT. The offer will expire November 6, 2001 if it has not been accepted by that date. |
