SL Green gets $4b nod from Reckson.

Reckson shareholders last week voted to approve one of the most divisive real estate mergers in recent history when they gave their approval to a $4 billion takeover by SL Green.

The vote came following several weeks of often acrimonious talks and an unsuccessful rival bid from billionaire investor, Carl Icahn.

It also came with a $25 million sweetener to shareholders bitter over Reckson chief executive Scott Rechler's deal to buy back the company's suburban holdings from SL Green.

Just prior to last week's shareholders meeting, SL Green said it had consented to Reckson declaring an additional special dividend of an aggregate of approximately $25 million representing approximately $.29 in cash per share.

The REIT said members of Reckson's management had agreed to waive "certain existing severance rights" in connection with the special dividend, which was conditioned on the shareholder approval and closing of both the SL Green merger and the purchase of the suburban properties by members of the management "and other investors."

Regardless of how it was done, SL Green was this week welcoming the news of the shareholder approval. "While the events of the past three weeks have not been easy, the decision validated the credibility of our bid in the strongest possible way. It was the best course of action, in the best interests of Reckson's investors," said the company in a statement.

The company pledged to provide shareholders with "top level service" stating it pledged to maintain and enhance that level at the properties it retains.

The shareholders approval came after Reckson's board rejected a rival bid from Icahn's American Real Estate Investors comprising $1 billion in cash and $3.3 billion in preferred stocks of his company that he said matched the $49 per share bid he had originally made in partnership with Harry Macklowe.

Icahn had pressed ahead with his solo offer to buy Reckson following a u-turn by his partners on the deal over the weekend. Both Macklowe Properties and Mack-Cali backed out of the partnership in which they had pledged to invest $1 billion towards the acquisition.

Jittery over the true value of the AREI securities, though, the Reckson board said no to Icahn and went back to the negotiating table with SL Green whose cash and stock offer is valued at roughly $4 billion.

Controversy surrounded the Green offer from the outset when it was noted that the sales price failed to match the company's share price. The Wall Street Journal reported that SL Green agreed to pay $43.31 a share for Reckson the day the deal was announced on August 3, 64 cents less than what the company's stock was trading for the previous day.

Shareholders were further angered when it was revealed that Scott Rechler had arranged to privately buy back Reckson's suburban holdings.

In it's statement issued this week, SL Green reminded shareholders, "In 2004 and 2005, we were #1 in the U.S. office REIT sector in total return to shareholders. We lead the sector in 2006 with only four weeks to go. And we believe we are well positioned to continue delivering superior financial results in 2007 and beyond."

The REIT predominantly acquires, owns, repositions and manages a portfolio of Manhattan office properties. As of September 30, 2006 the coompany owned 27 office properties totaling approximately 18.4 million square feet.