===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------
SCHEDULE TO
(RULE 14D-100)
TENDER OFFER STATEMENT UNDER SECTION 14(D)(1)
OR SECTION 13(E)(1) OF THE SECURITIES EXCHANGE ACT OF 1934
BROOKDALE LIVING COMMUNITIES, INC.
(Name of Subject Company (Issuer))
FORTRESS BROOKDALE ACQUISITION LLC
(Names of Filing Persons (Offerors))
COMMON STOCK, PAR VALUE $.O1 PER SHARE
(Title of Class of Securities)
--------------
(CUSIP Number of Class of Securities)
--------------
Randal A. Nardone
Fortress Investment Holdings, LLC
1301 Avenue of the Americas
New York, New York 10019
Telephone: (212) 798-6100
(Name, address and telephone number of
person authorized to receive notices
and communications on behalf of filing persons)
Copy to:
J. Gregory Milmoe, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036
Telephone: (212) 735-3000
|X| Check the box if the filing relates solely to preliminary
communications made before the commencement of a tender offer.
Check the appropriate boxes below to designate any transactions to which the
statement relates:
|X| third-party tender offer subject to Rule 14d-1.
|_| issuer tender offer subject to Rule 13e-4.
|X| going-private transaction subject to Rule 13e-3.
|_| amendment to Schedule 13D under Rule 13d-2.
Check the following box if the filing is a final amendment reporting the
results of the tender offer: |_|
===============================================================================
FOR FURTHER INFORMATION:
AT: BROOKDALE LIVING AT: FORTRESS BROOKDALE
COMMUNITIES, INC. ACQUISITION LLC
Mark J. Schulte Lilly H. Donohue
Chairman, President and Vice President of Fortress Investment
Chief Executive Officer Fund LLC
312-977-3700 212-798-6118
AT: EDELMAN PUBLIC RELATIONS
Kenneth G. Trantowski
Executive Vice President &
General Manager
312-240-2625
FOR IMMEDIATE RELEASE
July 26, 2000
BROOKDALE LIVING COMMUNITIES, INC. SIGNS
DEFINITIVE MERGER AGREEMENT WITH FORTRESS
BROOKDALE ACQUISITION LLC
STOCKHOLDERS TO RECEIVE $15.25 PER SHARE IN CASH
JULY 26, 2000 - Brookdale Living Communities, Inc. ("Brookdale") (Nasdaq:
BLCI), a leading provider of senior and assisted living services to the
elderly, and Fortress Brookdale Acquisition LLC ("Purchaser"), a joint
venture owned by an affiliate of Fortress Investment Fund LLC ("Fortress")
and an affiliate of Capital Z Partners ("Health Partners"), today announced
that they have signed a definitive merger agreement providing for the
acquisition of all of Brookdale's outstanding shares of common stock not
already owned by Purchaser for $15.25 per share in cash. As previously
announced, in May 2000, Purchaser purchased approximately 39.9% of
Brookdale's outstanding common stock from a principal stockholder
of Brookdale for $15.00 per share. Health Partners has also agreed to
contribute to the Purchaser its $100,000,000 5 1/2% Convertible
Subordinated Note due 2009 issued by Brookdale which is convertible into
approximately 5.5 million shares of Brookdale's common stock.
The all-cash transaction, which is structured as a $15.25 per-share cash
tender offer followed by a second-step merger of Brookdale with a
subsidiary of Purchaser, is valued at approximately $91 million excluding
shares already owned by Purchaser. The tender offer is expected to commence
on August 1, 2000 and conclude on September 5, 2000. Brookdale has
approximately 15.4 million shares outstanding on a fully diluted basis,
including approximately 4.0 million shares owned by Purchaser. Brookdale's
Board of Directors, acting upon the unanimous recommendation of a committee
of independent directors composed entirely of non-management directors (the
"Independent Committee"), recommends that the stockholders of Brookdale
(other than Purchaser and its affiliates) tender their shares pursuant to
the tender offer. The Independent Committee and the Brookdale Board
received an opinion from Merrill Lynch & Co., the Independent Committee's
financial advisor, to the effect that the $15.25 per share price in the
tender offer and the merger is fair to the stockholders of Brookdale (other
than Purchaser and its affiliates) from a financial point of view.
"This merger announcement is exciting for several reasons," said Mark J.
Schulte, Chairman, President and Chief Executive Officer of Brookdale. "We
believe that this transaction maximizes existing stockholder value by
giving stockholders a 40% premium to where our stock was trading prior to
the announcement of Purchaser's initial purchase in April 2000. This
transaction also secures the sponsorship of two major private equity funds
to continue Brookdale's growth which is particularly important given the
current weakness in the public markets with respect to assisted living and
health care companies."
"We are very pleased to be making this investment in Brookdale," said
Wesley R. Edens, Chairman and Chief Executive Officer of Fortress. "We
firmly believe Brookdale's strong management team under Mark's continuing
leadership, solid operations, urban focus and high quality real estate
positions Brookdale to be a consolidator and major player in the near and
long term."
Day-to-day operations of Brookdale will not change following the
acquisition despite the change in ownership. The Company's current
leadership team will remain intact with Mark Schulte continuing in his role
as Chairman, President and Chief Executive Officer of Brookdale.
The tender offer and merger will be subject to certain customary
conditions; however, the tender offer is not subject to a financing
condition or a condition that any minimum number of shares be tendered. In
addition, the waiting period under the Hart-Scott-Rodino Act was satisfied
in connection with Purchaser's initial purchase of Brookdale stock in May
2000.
Purchaser will be paid an expense reimbursement payment of $750,000 in the
event that the Independent Committee receives a higher offer from a third
party and accepts that offer pursuant to the exercise of its fiduciary
duties. Other than the expense reimbursement payment, no other "break-up"
or "commitment" fee would be payable in such event.
Fortress is a real estate opportunity fund located in New York with over
$870 million of private equity capital. Fortress focuses on real
estate-related investments worldwide.
Based in New York, Capital Z Financial Services Fund II, L.P. (the general
partner of Health Partners) is a $1.85 billion global private equity fund
that focuses exclusively on investments in the insurance, financial
services and health care services industries. The fund, which was formed in
August 1998, is managed by Capital Z Partners, a global alternative asset
management firm headquartered in New York City with offices or affiliates
in London and Hong Kong. Capital Z Partners also manages Capital Z
Investments, L.P., a $1.5 billion fund which focuses exclusively on
investments in private equity funds, hedge funds and other alternative
investment vehicles. Since 1990, Capital Z Partners and its predecessor
funds have invested in excess of $1.5 billion in over 50 transactions with
an aggregate market value in excess of $12 billion.
In addition, Brookdale today announced it had signed a definitive agreement
to purchase four of the facilities that Brookdale currently leases and
operates from the lessor, an affiliate of Senior Housing Properties Trust,
for $123 million. The facilities to be purchased consist of The Hallmark,
located in Chicago, Illinois, The Springs of East Mesa, located in Mesa,
Arizona, The Gables at Brighton, located in Brighton, New York, and Park
Place, located in Spokane, Washington, and in the aggregate contain 837
units. In accordance with the purchase agreement, Brookdale is required to
make a $12.3 million earnest money escrow deposit, creditable against the
purchase price, and the purchase must be completed by October 31, 2000.
THE TENDER OFFER FOR THE OUTSTANDING SHARES OF COMMON STOCK OF BROOKDALE
DESCRIBED IN THIS ANNOUNCEMENT HAS NOT YET COMMENCED, AND THIS ANNOUNCEMENT
IS NEITHER AN OFFER TO PURCHASE NOR A SOLICITATION OF AN OFFER TO SELL
SECURITIES. THE TENDER OFFER WILL BE MADE ONLY THROUGH PURCHASER'S OFFER TO
PURCHASE AND THE RELATED LETTER OF TRANSMITTAL. WE URGE INVESTORS AND
SECURITY HOLDERS TO READ THE FOLLOWING DOCUMENTS WHEN THEY BECOME
AVAILABLE, REGARDING THE TENDER OFFER AND THE MERGER (DESCRIBED ABOVE),
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION:
o PURCHASER'S TENDER OFFER STATEMENT ON SCHEDULE TO
INCLUDING THE OFFER TO PURCHASE, LETTER OF TRANSMITTAL
AND NOTICE OF GUARANTEED DELIVERY
o BROOKDALE'S SOLICITATION/RECOMMENDATION STATEMENT ON
SCHEDULE 14-D-9.
THESE DOCUMENTS AND AMENDMENTS TO THESE DOCUMENTS WILL BE FILED WITH THE
UNITED STATES SECURITIES AND EXCHANGE COMMISSION WHEN THE TENDER OFFER
COMMENCES. WHEN THESE AND OTHER DOCUMENTS ARE FILED WITH THE SEC, THEY MAY
BE OBTAINED FREE AT THE SEC'S WEB SITE AT WWW.SEC.GOV. YOU MAY ALSO OBTAIN
FOR FREE EACH OF THESE DOCUMENTS (WHEN AVAILABLE) FROM THE INFORMATION
AGENT FOR THE OFFER, TO BE ANNOUNCED.
Brookdale Living Communities, Inc. is a leading national provider of senior
and assisted living services to the elderly, with 24 facilities in 14
states containing an aggregate of approximately 5,328 units in urban and
suburban communities. Additional information is available on Brookdale's
web site at www.brookdaleliving.com.
This news release contains certain forward-looking statements. When used in
this news release, the words "believes," "expects," "anticipates,"
"estimates" and similar words or expressions are generally intended to
identify forward-looking statements. These forward- looking statements
involve risks and uncertainties, such as the risks detailed in Brookdale's
filings with the Securities and Exchange Commission.
