Venable recently served as primary outside legal advisor to its client CRIIMI MAE Inc., a New York Stock Exchange company, in closing a recapitalization transaction that increases the financial flexibility and allows for renewed growth of the company, which emerged from Chapter 11 in 2001.
The recapitalization includes the purchase of $30 million of CRIIMI MAE subordinated debt and a $14 million equity investment in the company by Brascan Real Estate Financial Investments LLC, a Canadian private asset management company established by Brascan Corp. and Barry S. Blattman, which gives it an 8% stake in CRIIMI MAE, and a $300 million secured financing by a unit of Bear, Stearns & Co. Inc. As part of the transaction Mr. Blattman was named Chairman of the Board and Chief Executive Officer of CRIIMI MAE. The company used the proceeds of the recapitalization, together with available cash and liquid assets, to pay off $373 million in remaining recourse debt incurred by it in connection with its emergence from Chapter 11 in 2001.
In the late 1990s CRIIMI MAE was the largest player in the subordinated commercial mortgage-backed securities market. The recapitalization allows the company to focus on its core business of purchasing CMBS and originating, pooling and securitizing commercial mortgages. Art Cirulnick led a team of corporate and securities lawyers in negotiating and structuring the transaction, which was recommended by a Special Committee of the CRIIMI MAE Board of Directors established for the purpose of reviewing numerous competing offers solicited by the company’s investment banker. The Venable team also included Bryson Cook, Richard Wasserman, Alan Yarbro, Mitchell Kolkin, Jag Singh, Anita Finkelstein, Neal Strum, Davis Sherman, Michael Conron, Tuck Washburne, Gregory Cross, Griselle Estrada and many others.
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