Spirit Realty Capital Inc.’s stock was up by 8% on Monday after it agreed to be acquired by Realty Income Corp. in a deal that values the Dallas-based real-estate-investment company at $9.3 billion.
The deal comes one trading day after Spirit Realty’s stock closed at a three-year low.
Realty Income’s stock
O,
-5.70%
was down 5.5% to $46.40 in regular trading. The stock is on track for its lowest close since April 6, 2020, when it closed at $45.33 a share, according to Dow Jones Market Data. The stock is on pace for the largest percent decrease since June 11, 2020, when it fell 6.84%.
Realty Income has agreed to pay 0.762 newly issued Realty Income common shares for each Spirit Realty Capital
SRC,
+7.85%
common share.
The buyout price for the company values Spirit Realty at $37.34 a share, a 15.4% premium over its $32.35-a-share close on Friday.
Realty Income is buying Spirit Realty’s portfolio of 2,064 retail and industrial properties in 49 states. Spirit had a 99.8% occupied rate as of June 30.
About 39% of Realty Income’s portfolio is in service retail, while about 26% is industrial and about 15% is in discretionary retail space. About 3% of its portfolio is office space, which has been impacted by lower demand due to employees working from home in the wake of the COVID-19 pandemic.
Realty Income said the deal will provide it with more than 2.5% accretion to its annualized adjusted funds from operations, or AFFO, per share.
Realty Income shareholders will own 87% of the combined company which will have a value of $63 billion. Spirit Realty shareholders will hold 13%.
The two real-estate companies expect the deal to close during the first quarter.
Also read: Blackstone sells Bellagio stake to Realty Income Corp. in post-COVID rebound
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