U.S. News

Reckson Shareholders Approve Takeover of SL Green Realty


RecksonAssociates Realty's shareholders approved an almost $4 billion takeover by SL Green Realty.

But billionaire investor Carl Icahn, who had made his own Reckson bid, hinted he would not
abandon his fight for some office buildings included the deal.

Thursday's vote followed two days of haggling and inconclusive ballot counting, as well as last-minute maneuvering by Icahn and Manhattan developer and office owner Harry Macklowe.

Earlier in the day, one of Reckson's largest shareholders, Cohen & Steers , said it was in full support of the deal after the companies said SL Green has consented to Reckson declaring an additional special dividend of 29 cents per share.

The deal contains an agreement where a management group led by Reckson Chief Executive Scott Rechler and Marathon Asset Management would acquire suburban New York properties from Green for $2.1 billion after the deal closes.

Icahn said he made a last-minute bid for some of the suburban New York properties -- office properties in Westchester County -- for $125 million more than the management-led group was offering.

Reckson said it could not consider the offer, saying its agreement with SL Green would only allow it to consider offers superior to the entire deal.

Icahn said the Rechler-led group had a fiduciary obligation to take the offer and hinted that the battle may not be over.

In an interview, Icahn said he "reminded Rechler of his fiduciary responsibility" to Reckson shareholders.

Further muddying the waters, Macklowe, who recently dropped out of the Icahn bidding group, had been considering bidding for certain Reckson properties in New York City as soon as this
week, a Macklowe spokesman said.

"In light of today's development, they have decided not to bid," the spokesman said, declining to elaborate.

A person close to the matter said Macklowe decided not to bid because of Reckson's eclaration of a $25-million special dividend for its shareholders.