Beaten-up Paramount rejects buyout, but is taking offers

Office landlord's share price fell by 60% earlier this year

 1633 Broadway and Paramount CEO Albert Behler (Google Maps; Getty)
1633 Broadway and Paramount CEO Albert Behler (Google Maps; Getty)

The embattled Paramount Group turned down a takeover bid from the hedge fund Bow Street — but may be open to offers.

Paramount rejected Bow Street’s unsolicited all-cash offer of $9.50 to $10 per share, Crain’s reported. On Wednesday, the company ended the day with its stocks trading at $9.43 per share.

But the unsolicited bid could lead other firms to try at a higher price point.

“Our board and management team remain open-minded,” Paramount chairman and CEO Albert Behler said in a letter to Bow Street managing partners Akiva Katz and Howard Shainker.

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Paramount, which has a market value of $2 billion, is much smaller than office behemoths like Vornado and SL Green Realty and could still be acquired.

It has a portfolio of about 15 office buildings in New York City and San Francisco, including Paramount Plaza at 1633 Broadway in Times Square. Its stock price fell by about 60 percent earlier this year.

Last year, Bow Street asked Mack-Cali Realty to restructure and claimed the company was in a “intractable state — overlevered, underoccupied, structurally impaired and lacking a credible path to sustainable shareholder value creation.” Mack-Cali eventually conceded and allowed Bow Street to nominate eight members to its nine-director board.

[Crain’s] — Keith Larsen