Exhibit 99.1
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) and CV Reit (NYSE), 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.
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.
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 previ ously 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, 610/941-9292
