Regular readers of our blog may remember Sizeler Property Investors, Inc. (NYSE:SIZ), which we covered back on September 7th, when the company received a letter from Opportunity Investors questioning why they weren't reviewing competitive bids. Well, Sizeler announced yesterday in an 8K filing with the SEC yesterday that it finally would consider the rival bid from Compson.

The company also revealed more details about the bid: It turns out that the bid is structured as an asset purchase, rather than a bid for the company as a whole. This means that the $16.10 per share would be paid for the real estate holdings of Sizeler; however, other company assets and liabilities would remain. The company said that the actual value to shareholders would be less than $16.10 per share; however, they are still currently working to review the bid.

Interestingly, about 10 minutes later, Revenue Properties Co. (with whom the company has the merger agreement at $15.50 per share) filed a 13D/A pointing out the flaws in the Compson bid:

"Among other relevant aspects of the Proposal, we would note the following: (1) the Proposal is non-binding and subject to negotiation of definitive documentation, (2) the Proposal relates to a purchase of assets only (and not a purchase of the public entity) and, as such, (i) Sizeler (and indirectly its stockholders) would continue to be responsible for significant wind-up costs, (ii) the actual receipt of consideration by Sizeler's stockholders would necessarily be subject to increased risk and delay, and (iii) Sizeler's stockholders would, we understand, be liable as transferees under State law for any liabilities of Sizeler that are not assumed or paid off by the purchaser under the Proposal, (3) while the Proposal refers to debt financing, a commitment letter was not included with the Proposal, (4) the Proposal appears to suggest that only $20 million of equity would be available for the transaction, (5) the Proposal calls for a break-up fee of $12 million, (6) the Proposal includes additional closing conditions relating to asset conveyances and estoppel certificates, and (7) while the Proposal does not seem to contemplate a "diligence out" in the definitive documentation, there appears to be an information review process
built into the Proposal."

The final valuation on the deal have yet to be determined by the company's analysts; however, the door is still open for a more competitive bid from either side. It is possible that Opportunity Investors and other majority holders may also want to review the proposal before siding with either offer. Currently investors are remaining prudent with shares sitting around $15.34 - up 2% since our first mention of the stock.

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