HALIFAX,
NS, Oct. 15, 2024 /CNW/ - Killam Apartment
REIT (TSX: KMP.UN) ("Killam" or the "REIT") is pleased
to announce that its Board of Trustees has unanimously approved a
proposed internal reorganization that will be accomplished by way
of a plan of arrangement (the "Arrangement"). The
Arrangement will be subject to unitholder approval at a special
meeting of Killam to be held on
November 21, 2024 (the
"Meeting").
The Arrangement will simplify Killam's organizational structure by
eliminating Killam Properties Inc. ("KPI"), a wholly-owned
subsidiary of the REIT, so that Killam Apartment Limited
Partnership will hold its entire investment in Killam Apartment
Subsidiary Limited Partnership ("Killam SLP") directly,
rather than partially through KPI. In the existing structure,
KPI is allocated its share of income and capital gains as a partner
of Killam SLP. The Arrangement is expected to reduce or eliminate
potential corporate taxation in respect of income and capital gains
allocated to KPI, thereby increasing future cash flow for
distribution to the REIT. The Arrangement is also expected to
reduce the complexity of accounting and legal reporting and of
income tax compliance inherent in Killam's existing structure. The REIT has
received an advance income tax ruling of the Canada Revenue Agency
in connection with the Arrangement.
The proposed Arrangement will not result in a change to
Killam's strategy, portfolio or
operations. After completing the Arrangement, unitholders will
continue to hold the same number, type and percentage of
outstanding units as they held immediately before the Arrangement
and the total number of units outstanding immediately following the
Arrangement will be the same as before. The REIT's trust units
("Trust Units") will continue to be listed on the TSX and
retain the same CUSIP number.
The Arrangement will be effected pursuant to a plan of
arrangement under the Canada Business Corporations Act and
is subject to the approval of 66⅔% of the votes cast by holders of
the Trust Units and special voting units of the REIT (the
"Special Voting Units"), voting together as a single class
(Special Voting Units are associated with Class B limited
partnership units of Killam Apartment Limited Partnership
("Exchangeable Units"), which is controlled by the REIT. The
Exchangeable Units are intended to be economically equivalent to
and exchangeable for Trust Units on a one-for-one basis and are
accompanied by Special Voting Units of the REIT that provide their
holders with equivalent voting rights to holders of Trust Units).
Trustees and officers of Killam,
who control collectively 3.72% of Killam's Trust Units and Special Voting Units,
have indicated their intention to vote in favour of the
Arrangement. In addition to the requirement for unitholder
approval, the completion of the Arrangement will be contingent on
all necessary third party, court and regulatory approvals,
including the approval of the Toronto Stock Exchange.
Unitholders who vote in favour of the Arrangement at the Meeting
will also be authorizing and approving the adoption of an Amended
and Restated Declaration of Trust of the REIT, which includes
amendments to the REIT's current governing Declaration of Trust
necessary to effect the Arrangement and other amendments of a
minor, housekeeping or clerical nature that are not prejudicial to
the Unitholders.
Further details on the Arrangement will be set out in an
information circular (the "Circular") expected to be filed
on SEDAR+ at sedarplus.ca and mailed to unitholders on or about
October 24, 2024, in advance of the
Meeting. Although the timing of the completion of the Arrangement
cannot be predicted with certainty, management anticipates the
Arrangement to become effective on November
30, 2024.
About Killam Apartment
REIT
Killam Apartment REIT, based in Halifax, Nova Scotia, is one of Canada's largest residential real estate
investment trusts, owning, operating, and developing a $5.3 billion portfolio of apartments and
manufactured home communities. Killam's strategy to drive value and
profitability focuses on three priorities: (1) increase earnings
from the existing portfolio; (2) expand the portfolio and diversify
geographically through accretive acquisitions, targeting newer
properties and dispositions of non-core assets; and (3) develop
high-quality properties in its core markets.
For information, please contact:
Claire Hawksworth, CPA
Senior Manager, Investor Relations
chawksworth@killamREIT.com
(902)
442-5322
Note: The Toronto Stock Exchange has neither approved nor
disapproved of the information contained herein. Certain
statements in this press release may constitute forward-looking
statements. In some cases, forward-looking statements can be
identified by the use of words such as "may," "will," "should,"
"expect," "intend," "plan," "anticipate," "believe," "continue,"
"remain," or the negative of these terms or other comparable
terminology, and by discussions of strategies that involve risks
and uncertainties. Such forward-looking statements may include,
among other things, statements regarding: the Arrangement and the
timing and benefits thereof; the Meeting and the timing thereof;
the effect of the Arrangement on holders of Trust Units and Special
Voting Units; the approvals required for the completion of the
Arrangement; the adoption of an Amended and Restated Declaration of
Trust and the terms thereof; the contents, mailing, and
availability of the Circular and the timing thereof; and
Killam's priorities.
Readers should be aware that these statements are subject to
known and unknown risks, uncertainties and other factors that could
cause actual results to differ materially from those anticipated or
implied, or those suggested by any forward-looking statements,
including: Killam's ability obtain
the necessary regulatory and third-party approvals, including,
among others, court, unitholder and Toronto Stock Exchange
approval; risks related to tax legislation and the interpretation
and application thereof; the effects and duration of local,
international and global events, any government responses thereto
and the effectiveness of measures intended to mitigate any impacts
thereof; competition; legislation and the interpretation and
enforcement thereof; litigation to which Killam may be subject; global, national and
regional economic conditions (including interest rates and
inflation); and the availability of capital to fund further
investments in Killam's business.
For more exhaustive information on these risks and uncertainties,
readers should refer to Killam's
most recently filed annual information form, Killam's most recently filed MD&A, as well
as the Circular, each of which is, or will be, available on SEDAR+
at www.sedarplus.ca. Given these uncertainties, readers are
cautioned not to place undue reliance on any forward-looking
statements contained in this press release. By their nature,
forward-looking statements involve numerous assumptions, inherent
risks and uncertainties, both general and specific, that contribute
to the possibility that the predictions, forecasts, projections and
various future events may not occur. Although management believes
that the expectations reflected in the forward-looking statements
are reasonable, there can be no assurance that future results,
levels of activity, performance or achievements will occur as
anticipated. Further, a forward-looking statement speaks only as of
the date on which such statement is made and should not be relied
upon as of any other date. While Killam anticipates that subsequent events and
developments may cause its views to change, Killam does not intend to update or revise any
forward-looking statement, whether as a result of new information,
future events, circumstances, or such other factors that affect
this information, except as required by law.
The forward-looking statements in this press release are
provided for the limited purpose of enabling current and potential
investors to evaluate an investment in Killam. Readers are cautioned that such
statements may not be appropriate and should not be used for any
other purpose. The forward-looking statements contained in this
press release are expressly qualified by this cautionary
statement.
SOURCE Killam Apartment Real Estate Investment Trust