Spirit Realty jumps on Realty Income buyout deal

Spirit Realty Capital

30/10/2023 12:56

** Shares of Spirit Realty  SRC.N  jump 12.1% to over 1-mth
high $36.26 premarket as Realty Income  O.N  to buy smaller
commercial REIT
    ** O says to acquire SRC in all-stock transaction at
enterprise value of ~$9.3 bln
    ** Under terms of deal, SRC shareholders to receive 0.762
newly-issued O shares for each SRC share owned
    ** Deal expected to close in Q1 2024; O and SRC shareholders
to own ~87% and ~13%, respectively, of combined firm
    ** Per Reuters calculation, SRC shareholders would receive
about $37.34/sh, which is 15.4% premium to stock's last close
    ** Through Fri close, SRC shares had lost 19% YTD and have
~$4.6 bln market cap, per LSEG data
    ** O's shares off >2% at $47.69 before the bell. Its stock
was down ~23% YTD through Fri and have roughly $35 bln deal
market value
    ** Commercial real estate stocks have been hit by surging
interest rates, worsening economic conditions and slow returns
to offices by workers

 (Lance Tupper is a Reuters market analyst. The views expressed
are his own)
 ((lance.tupper@thomsonreuters.com
lance.tupper@tr.com 1-646-279-6380))