In 1986, in Newton, Massachusetts, the CommonWealth REIT was formed and since then it has grown to own US$7.2 billion of office and industrial properties as of its latest filing of March 31, 2013. Its current chairman and president are Barry Portnoy and his son Adam respectively.
It is now embroiled in a takeover bid against Corvex Management LP of Keith Meister and Related Fund Management LLC of Jeff Blau. The bid offer is at US$2.9 billion or the other option is to replace all the members of the board, including the Portnoys. Lately though, the governance tactics led by Barry and Adam Portnoy have held the two hedge fund firms at bay.
One of the reasons for the moves of Corvex and Related Fund is that the current poor corporate governance as well as the excessive fees paid by the REIT to an external management company owned by the Portnoys has led to the slow decline of the stock value of the firm.
Regardless of the machinations, there are so many takeover barriers in place, such as dual class voting shares, "Dead Hand" tactics and mandatory arbitration for shareholder conflicts. This has thwarted any and all of the attempts to gain control of the firm.
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