Spin-Off Expected to be Completed in
Late-December
Douglas Elliman’s Common Stock Expected to
Trade on the New York Stock Exchange Under the Symbol “DOUG”
Vector Group Ltd. (NYSE: VGR) (“Vector Group”) today announced
that its board of directors (the “Board”) has approved the spin-off
of Douglas Elliman Inc. (“Douglas Elliman”), which is expected to
be completed in late-December.
Upon completion of the spin-off, Vector Group will operate the
tobacco segment of its business, which includes the manufacture and
sale of cigarettes in the United States through Vector Group’s
subsidiaries Liggett Group LLC and Vector Tobacco Inc., while also
continuing to own interests in numerous properties and real estate
projects across the United States. Douglas Elliman will own and
operate the real estate services and property technology
(“PropTech”) investment business currently owned and operated by
Vector Group through its subsidiary New Valley, LLC, and will be
capitalized with approximately $200 million in net cash and cash
equivalents.
“The Board’s approval of the spin-off paves the way for us to
establish Douglas Elliman as an independent publicly traded company
in the coming weeks,” said Howard M. Lorber, President & Chief
Executive Officer of Vector Group and Chairman, President &
Chief Executive Officer of Douglas Elliman. “We are confident this
separation is in the best interests of Vector Group, Douglas
Elliman, our stockholders, and all our stakeholders. As a
standalone company, Douglas Elliman will have a dedicated
management team and Board, direct access to the public markets, and
additional resources to capitalize on opportunities in the large
and growing U.S. residential real estate market.”
The distribution is expected to take place on December 29, 2021
to holders of Vector Group common stock (including Vector Group
common stock underlying outstanding Vector Group stock option
awards and restricted stock awards) of record as of the close of
business on December 20, 2021, the record date for the
distribution. Each Vector Group common stockholder will receive one
share of Douglas Elliman common stock for every two shares of
Vector Group common stock held as of the record date.
No action or payment is required by Vector Group stockholders to
receive shares of Douglas Elliman. For Vector Group stockholders
who hold Vector Group common stock in registered form and for
holders of outstanding Vector Group stock option awards and
restricted stock awards as of the record date, in most cases the
transfer and distribution agent will credit their shares of Douglas
Elliman common stock to their book entry accounts. For stockholders
who own Vector Group common stock through a broker or other
nominee, their accounts will be credited with the new Douglas
Elliman shares by the broker or other nominee. A prospectus
containing details regarding the distribution of the new Douglas
Elliman common stock and the Douglas Elliman business and
management following the spin-off will be made available to Vector
Group stockholders as of the record date prior to the distribution
date.
For a period of time to be determined prior to the distribution,
the new Douglas Elliman common stock is expected to trade on a
“when-issued” basis on the NYSE under the symbol “DOUG WI” and
Vector Group expects that its common stock will trade in two
markets on the NYSE: in the “regular way” market under the symbol
“VGR” and in the “ex-distribution” market under the symbol “VGR
WI”. The dates for “when issued” and “ex-distribution” are expected
to be released prior to the December 20, 2021 record date.
Investors are encouraged to consult with their financial advisors
regarding the specific implications of buying or selling Vector
Group common stock on or before the distribution date.
The distribution is expected to qualify as a tax-free
distribution for U.S. federal income tax purposes. Vector Group
encourages stockholders to consult with their tax advisors with
respect to U.S. federal, state, local and foreign tax consequences
of the spin-off. Completion of the spin-off is subject to various
conditions, including receipt of a tax opinion from counsel and the
effectiveness of Douglas Elliman’s registration statement on Form
S-1. Jefferies LLC serves as financial advisor to Vector Group and
Sullivan & Cromwell LLP serves as legal counsel to Vector Group
and Douglas Elliman.
About Vector Group Ltd.
Vector Group is a holding company for Liggett Group LLC, Vector
Tobacco Inc., New Valley LLC, and Douglas Elliman Realty, LLC.
Additional information concerning Vector Group is available on its
website, www.VectorGroupLtd.com.
Investors and others should note that we may post information
about Vector Group or its subsidiaries on our website at
www.VectorGroupLtd.com and/or at the websites of those subsidiaries
or, if applicable, on their accounts on Facebook, Instagram,
LinkedIn, TikTok, Twitter, YouTube or other social media platforms.
It is possible that the postings or releases could include
information deemed to be material information. Therefore, we
encourage investors, the media and others interested in Vector
Group to review the information we post on our website at
www.VectorGroupLtd.com, on the websites of our subsidiaries and on
their social media accounts.
Disclaimer
Douglas Elliman has filed a registration statement with the SEC
relating to the proposed distribution of Douglas Elliman
securities, which may not be sold, nor may offers to buy be
accepted, before a registration statement for such securities
becomes effective. This press release does not constitute an offer
to sell or the solicitation of an offer to buy, nor will there be
any sale of Douglas Elliman securities in any state or jurisdiction
in which such offer, solicitation, or sale would be unlawful prior
to registration or qualification.
Special Note on Forward-Looking Statements
This press release may contain “forward-looking statements”
within the meaning of the federal securities laws. Forward-looking
statements include information relating to our intent, belief or
current expectations, primarily with respect to, but not limited
to, economic outlook, capital expenditures, cost reduction, cash
flows, operating performance, growth expectations, competition,
legislation and regulations, litigation, and related industry
developments (including trends affecting our business, financial
condition and results of operations) and our spin-off of Douglas
Elliman.
Forward-looking statements can be identified by words or phrases
such as “anticipate,” “believe,” “continue,” “could,” “estimate,”
“expect,” “intend,” “may be,” “objective,” “opportunistically,”
“plan,” “potential,” “predict,” “project,” “prospects,” “seek,” and
“will be” and similar words or phrases or their negatives.
Forward-looking statements involve important risks and
uncertainties that could cause our actual results, performance or
achievements to differ materially from our anticipated results,
performance or achievements expressed or implied by the
forward-looking statements. Further information on the risks and
uncertainties to the business of Vector Group include the risk
factors described in the filings of Vector Group with the SEC.
Factors that could cause actual results of Douglas Elliman to
differ materially from those suggested by forward-looking
statements include: general economic and market conditions, and any
changes therein, due to acts of war and terrorism or otherwise;
governmental regulations and policies; adverse changes in global,
national, regional and local economic and market conditions,
including those related to pandemics and health crises, such as the
outbreak of COVID-19 and the impact of potential COVID-19 variants;
the extent and timing of COVID-19 vaccine administration and the
duration of the COVID-19 pandemic; Douglas Elliman’s ability to
effectively manage the impacts of the COVID-19 pandemic and any
government-mandated or encouraged suspension of our business
operations; the impacts of the Tax Cuts and Jobs Act of 2017,
including its impact on the markets of Douglas Elliman’s business;
effects of industry competition; severe weather events or natural
or man-made disasters, including increasing the severity or
frequency of such events due to climate change or otherwise, or
other catastrophic events may disrupt Douglas Elliman’s business
and have an unfavorable impact on home sale activity; the level of
Douglas Elliman’s expenses, including its corporate expenses as a
stand-alone publicly-traded company; Douglas Elliman’s status as an
emerging growth company; the tax-free treatment of the spin-off;
Douglas Elliman’s lack of operating history as a public company and
costs associated with being an independent public company;
potential dilution to holders of Douglas Elliman’s common stock as
a result of issuances of additional shares of common stock to fund
its financial obligations and other financing activities; the
failure of Douglas Elliman or Vector Group to satisfy their
respective obligations under the agreements entered into in
connection with the spin-off; and the additional factors described
under “Risk Factors” in the registration statement on Form S-1
filed with the SEC by Douglas Elliman.
The forward-looking statements speak only as of the date they
are made, and we disclaim any obligation to update or revise the
forward-looking statements contained herein, except as otherwise
required by applicable federal securities laws.
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version on businesswire.com: https://www.businesswire.com/news/home/20211210005556/en/
Emily Claffey / Benjamin Spicehandler Sard Verbinnen & Co
212-687-8080
Eve Young Sard Verbinnen & Co - Europe +44 (0)20 3178
8914
J. Bryant Kirkland III, Vector Group Ltd. 305-579-8000
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