Kranzco and CV Reit Shareholders Approve Merger; Businesses to Combine in New
UPREIT, Kramont Realty Trust; Seven Member Board of Trustees Named
CONSHOHOCKEN, Pa. and NEW YORK--(BUSINESS WIRE)--June 6, 2000--The shareholders
of Kranzco Realty Trust (NYSE:KRT) and CV Reit (NYSE:CVI), at special meetings
held today, approved the plan of reorganization and merger of the two
neighborhood shopping center real estate investment trusts.
The shareholders' actions authorize the tax-free combination of the two
businesses into a new entity, Kramont Realty Trust, an umbrella partnership real
estate investment trust (UPREIT). Kramont will own and operate 84 shopping
centers and manage six additional centers, totaling 12 million square feet of
leasable space in 16 states.
The company will be headquartered in Plymouth Meeting, PA. Following an
announcement that trading will commence, Kramont's common stock will trade on
the New York Stock Exchange under the symbol: KRT,
Upon closing of the reorganization and merger, Kranzco and CV Reit common
shareholders will receive one common share of Kramont in exchange for each of
their common shares of Kranzco and CV Reit. Each Kranzco preferred share will
convert into one preferred share of Kramont, with the same rights.
The merger agreement anticipates initial quarterly cash distributions of 32.5
cents per common share, or $1.30 per share on an annualized basis.
Louis P. Meshon, Sr., president and chief executive officer of CV Reit, will
assume the same titles and responsibilities at Kramont. Addressing the special
CV Reit shareholder meeting in New York, he noted: "CV Reit has demonstrated
outstanding success in the management, leasing and upgrading of properties. The
merger now permits those skills to be applied on a much larger scale, offering
exciting opportunities for growth and increased profitability. The merger
provides CV Reit shareholders with participation in a company with greater
geographic and tenant diversity, a higher distribution rate and substantially
increased liquidity."
Norman M. Kranzdorf, president and chief executive officer of Kranzco, will be
chairman of the board of Kramont. He told shareholders at the special meeting in
Conshohocken, PA: "During nearly eight years as a public company, Kranzco has
achieved gratifying growth, developed strong relationships with many of the
nation's leading retailers, and applied state-of-the-art technology to operating
disciplines and for the benefit of tenants. We are confident that Kramont, with
greater financial and human resources, will be able to expand upon these
achievements."
At the special meetings, shareholders also approved the 2000 Incentive Plan of
Kramont Realty Trust.
The Kramont board of trustees will consist of seven members, four of whom were
nominated by CV Reit. Each individual has extensive experience in the real
estate industry and with publicly-traded companies.
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The members include:
Louis P. Meshon, Sr., 59, who has more than 30 years experience in shopping
center management and development. He was president of Drexel Realty, Inc. and
Montgomery Development Company, which he co-founded in 1974.
In 1997, CV Reit acquired the properties controlled by Meshon, Sr., through its
subsidiary, Montgomery CV Realty L.P., and he assumed the positions of
president, chief executive officer and as a director of CV Reit.
Norman M. Kranzdorf, 69, is a co-founder of Kranzco in 1992, and president of
its predecessor company, Kranzco Realty, Inc., a general commercial real estate
management and brokerage company, which he founded in 1979.
He has been involved in shopping center and commercial real estate ownership and
management for more than 40 years, serving in a variety of management capacities
including president of Amterre Development Inc., from 1972 to 1981. Amterre was
the successor to Food Fair Properties, Inc., which owned and operated over 50
shopping centers and other single-tenant properties on the East Coast.
Bernard J. Korman, 68, has been a trustee of Kranzco since May 1997. He is
chairman of Philadelphia Health Care Trust, a non-profit organization and
NutraMax Products, Inc., a consumer health products company. Korman served as
president and chief executive officer of MEDIQ Incorporated, a health services
company, from 1981 to 1995 and as chairman of PCI Services from 1992 to 1996.
He serves as a director of Pep Boys, Inc., auto supplies; The New America High
Income Fund, Inc., financial services; Omega Healthcare Investors, Inc., a
health care REIT; and Omega Worldwide, Inc., a real estate company.
H. Irwin Levy, 73, has been a director and chairman of the board of CV Reit
since 1997 and was its chairman and chief executive officer from 1985 to 1992.
He is chairman, chief executive officer and a majority stockholder of Hilcoast
Development Corp., principally engaged in the ownership and management of
recreation facilities at active adult condominium communities in southern
Florida.
He is chairman of the board of nStor Technologies, Inc. (AMEX), a manufacturer
of information storage and storage area network solutions.
Milton S. Schneider, 50, has been a director of CV Reit since December 1997.
He is chief executive officer of The Glenville Group, engaged in the
development, ownership and management of commercial and residential properties;
chairman of Togar Property Company, an apartment development firm; vice chairman
of Parkland Management Company, a financial services company; and vice chairman
of Horvitz Newspapers, Inc.
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E. Donald Shapiro, 68, has been a trustee of Kranzco since June 1994. He has
been the Joseph Solomon Distinguished Professor of Law at New York Law School
since 1983.
He serves as a director of Loral Space and Communications, engaged in satellite
communications; GHI, a non-profit health care provider; Vasomedical, Inc.,
medical products; United Industrial Corporation, defense industry; and Frequency
Electronics, space and communication components.
Alan L. Shulman, 67, has served as a director of CV Reit since 1985 and was the
company's chairman from August 1992 until May 1996. He is a private investor and
was previously a general partner of United Associates Ltd., which owned and
operated Holiday Inn motels in Florida. He is a director of Eagle Homes, a real
estate development company.
Kramont will be a self-administered, self-managed equity REIT specializing in
neighborhood and community shopping center acquisition, leasing, development and
management. Kramont will own and operate 90 properties encompassing
approximately 12 million square feet of leasable space in 16 states.
This press release contains certain forward-looking statements within the
meaning of the Securities Act of 1933, as amended. Future events and actual
results, financial and otherwise, may differ materially from the results
discussed in the forward-looking statements.
Risks and other factors that might cause such a difference include, but are not
limited to, the effect of economic and market conditions; risks that the
Company's acquisition and development projects will fail to perform as expected;
cost overruns and delays on expansion and development projects; financing risks,
such as the inability to obtain debt or equity financings on favorable terms;
the level and volatility of interest rates; loss or bankruptcy of one or more of
the Company's major retail tenants; failure of the Company's properties to
generate additional income to offset increases in operating expenses and failure
to consummate a strategic transaction, as well as other risks listed from time
to time in the Company's reports filed with the Securities and Exchange
Commission or otherwise publicly disseminated by the Company.
CONTACT:
Kranzco Realty Trust, Conshohocken
Norman Kranzdorf, 610941-9292
KEYWORD: PENNSYLVANIA NEW YORK
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