Empire State Building IPO clears legal hurdle - Los Angeles News | FOX 11 LA KTTV

Empire State Building IPO clears legal hurdle

MyFoxNY.com file photo MyFoxNY.com file photo

By TOM HAYS | AP

NEW YORK (AP) - A legal challenge to an ambitious plan to let the public buy shares in 1 of New York City's most famous landmarks - the Empire State Building - was cast aside on Tuesday in a ruling by a Manhattan judge.

Judge O. Peter Sherwood rejected arguments by a small group of current investors in the building that the initial public offering would violate state law.

The ruling stems from a long-running dispute over plans by real estate magnates Peter Malkin and his son Anthony to offer the public shares in their holdings in Manhattan and Connecticut, including the 102-story Empire State Building. The offering is expected to raise $1 billion for a new company called Empire State Trust Inc.

Some of the country's marque buildings, including the General Motors building in New York and the Embarcadero Center in San Francisco, are owned by publicly traded companies. But the IPO for the Empire State Building is viewed as a rare chance for investors to own a piece of history - an iconic Art Deco skyscraper visited by millions of tourists each year and featured in films like "King Kong" and "Sleepless in Seattle."

When the Empire State Building changed hands in 1961, the buyers sold 1,100 shares at $10,000 per share to help finance the deal. Some of the 3,300 investors were ordinary New Yorkers who pulled together just enough cash to buy partial shares.

The Empire State Building's controlling investors have said they are close to getting approval of 80% of the smaller shareholders for the public offering - the percentage needed to go forward.

"We are pleased by the court's ruling and are proceeding with our solicitation with the intention of closing as soon as we reach the approval threshold," said Hugh Burns, spokesman for Malkin Holdings. "The fact is that far more investors support this transaction than oppose it. We are focused on delivering the majority what they want as quickly as possible."

There was no immediate comment from the plans' opponents, but their lawyers have said they would appeal if the ruling went against them.

Before Tuesday's ruling, a small group of holdouts had challenged a provision that would allow the Malkins to buy them out for $100 a share if they voted against the plan. The proposed public offering values the shares at more than $300,000 each.

A lawyer for the plaintiffs had argued that the provision was being use to coerce the holdouts into switching their votes, and that they deserved fair value for their shares no matter how they voted. Attorneys for the Malkins countered that the provision was well within the law, and intended to keep a small minority from dictating the future of the property.

Sherwood's ruling says the plaintiffs had wrongly sought to assert so-called "appraisal rights" that normally apply to deals involving mergers or consolidations.

"The applicants are not entitled to assert any appraisal rights because the transaction is neither a merger nor a consolidation as defined in the Limited Liability Company law," the judge wrote.

Earlier this year, Sherwood gave preliminary approval to a $55 million settlement in a lawsuit brought by shareholders who sued over tax and other issues. Final approval could come at a hearing scheduled for Thursday.

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

  • Manhattan NewsManhattan NewsMore>>

  • 2 U.S. marshals, 1 NYPD detective shot in Manhattan

    2 U.S. marshals, 1 NYPD detective shot in Manhattan

    Monday, July 28 2014 4:28 PM EDT2014-07-28 20:28:07 GMT
    Two deputy U.S. marshals, an NYPD detective, and a sexual assault suspect have been shot in a shootout in the West Village in Manhattan, officials said. The shootout happened near West 4th Street and Jones Street. Speaking at a news conference, Mayor Bill de Blasio said the marshals and cop were taken to a local hospital with apparently non-life threatening injuries.
    Two deputy U.S. marshals, an NYPD detective, and a sexual assault suspect have been shot in a shootout in the West Village in Manhattan, officials said. The shootout happened near West 4th Street and Jones Street. Speaking at a news conference, Mayor Bill de Blasio said the marshals and cop were taken to a local hospital with apparently non-life threatening injuries.
  • Mayor, family move into Gracie Mansion

    Mayor, family move into Gracie Mansion

    Monday, July 28 2014 7:51 AM EDT2014-07-28 11:51:30 GMT
    It's home, sweet new home for Mayor Bill de Blasio and his family. The mayor, his wife and two children spent their first night in Gracie Mansion on Sunday. The De Blasios returned from a vacation in Italy Sunday afternoon.
    It's home, sweet new home for Mayor Bill de Blasio and his family. The mayor, his wife and two children spent their first night in Gracie Mansion on Sunday. The De Blasios returned from a vacation in Italy Sunday afternoon. De Blasio had spent some time debating whether to move out of his family's home in the Park Slope section of Brooklyn, but the family ultimately decided to make the shift.
  • 'Spider-man' slugs cop in Times Square

    'Spider-man' slugs cop in Times Square

    Monday, July 28 2014 7:01 AM EDT2014-07-28 11:01:40 GMT
    A man dressed as Spider-Man was arraigned on charges he punched a police officer who told him to stop harassing tourists in Time Square. Junior Bishop, 25, faces charges of assault, criminal mischief, resisting arrest and disorderly conduct. Police say the officer interceded after Bishop demanded at least $5 from a woman he posed for a picture with, instead of the $1 she offered.
    A man dressed as Spider-Man was arraigned on charges he punched a police officer who told him to stop harassing tourists in Time Square. Junior Bishop, 25, faces charges of assault, criminal mischief, resisting arrest and disorderly conduct. Police say the officer interceded after Bishop demanded at least $5 from a woman he posed for a picture with, instead of the $1 she offered.
Powered by WorldNow

KTTV FOX 11
1999 S. Bundy Dr.
Los Angeles CA 90025

Main: (310) 584-2000
News Tips? (310) 584-2025

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | Terms of Service | Ad Choices