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Cousins, Parkway deal talks go back 2 years

The talksthat ultimately yielded a Cousins PropertiesInc.-Parkway PropertiesInc. mergerand simultaneous Houston-only REIT spinoff began about two years ago and covereda wide range of options, Cousins President and CEO Larry Gellerstedt III said onan April 29 conference call.

"Sometimes[the talks] involved an asset, sometimes it involved a city … but it takes a sortof unique … timing for these things to work for all parties," Gellerstedt saidduring the Q&A segment, by way of explaining the genesis of the deal.

He saidthe geographic overlay of the two companies' portfolios ultimately pointed towarda merger.

ParkwayPresident and CEO Jim Heistand later weighed in, adding: "The market has heardrumors, and we've looked at all kinds of opportunities that we thought would enhanceour shareholder value. We think it's important for companies to have some scale."

An analystasked executives on the call if there had been any other prospective deals and ifany bids had emerged from the private side prior to inking the merger agreement.

"Ifthere was a private bid that was at a price we thought made sense, we would havetaken it," Heistand said.

Later,Heistand framed Parkway's recent sales in the Houston market as portfolio-improvingdeals that involved properties that would not fit with the prospective HoustonCo.Most of the deals predated the decline in oil prices, he noted.

"It'sday and night from the assets we sold before," Heistand said. "And I hadno desire to be selling these assets at the wrong time in the market."

Heistandand Gellerstedt insisted that both companies — the new Cousins and HoustonCo — willremain distinct entities, each free to invest in Houston as they see fit.