W.P. Carey merger gives investors slice of $2b pie.

Investment firm W. P. Carey & Co. LLC announced that shareholders of Corporate Property Associates 12 Incorporated (CPA[R]:12) and Corporate Property Associates 14 Incorporated (CPA[R]:14), members of the W. P. Carey Group of companies, have each approved the merger of the two companies.

CPA[R]:14 will be the surviving company. The merger closed on December 1, 2006. Edward V. LaPuma, president of CPA[R]:14, said, "This merger will provide our investors with a more diversified portfolio and an asset base in excess of $2.1 billion. I want to welcome our new investors to the CPA[R]:14 family as we look to meet their investment expectations."

The merger represents the twelfth successful liquidation of a W. P. Carey fund since 1998. Under the terms of the merger, CPA[R]:12 shareholders of record on November 30, 2006 received a special cash distribution of $3.19 per share and, in addition, for shareholders of record as of October 20, 2006 the choice of either another $10.30 in cash or 0.8692 shares of CPA[R]:14. CPA[R]:12 shareholders holding 31.8 percent of the outstanding shares elected the cash option, while the remainder will receive shares of CPA[R]: 14. CPA[R]: 12's average annual return over the fund's twelve-year history is 10.91 percent.

Immediately prior to the merger, W. P. Carey & Co. LLC, the manager and advisor to the CPA[R] series of funds, acquired a whole or partial interest in 37 properties from CPA[R]:12 for approximately $126 million, which includes the assumption of debt. These properties, totaling approximately 1.7 million square feet, consist primarily of office, industrial, retail and warehouse facilities located in the United States and France. The lease terms of the properties to be acquired by W. P. Carey & Co. LLC expire before 2013. CPA[R]:12 and CPA[R]:14 are each managed by W. P. Carey & Co. LLC.

Upon completion of the merger, CPA[R]:14 will issue approximately 18,470,351 million shares of CPA[R]:14 common stock and approximately $102 million in cash and will acquire 87 properties located in 25 states, totaling approximately 6.6 million square feet. These properties have lease terms of greater than 8 years. The price paid for CPA[R]:12's properties was based on an appraisal performed by a third party appraiser.

"We are very pleased to have completed the liquidation of our 12th fund over the past 27 years of managing the CPA[R] series and to have been able to offer a transaction that was strongly endorsed by the shareholders of both CPA[R]:12 and CPA[R]:14," said Gordon F. DuGan, president and chief executive officer of W. P. Carey & Co. LLC.

"We are also extremely proud of our track record of providing investors of our affiliated REITs with rising income and liquidity of their investment. Twelve of our funds have now gone full-cycle to liquidity and have provided shareholders an average annual return of 11.56%."