Temperature-controlled warehouse owner Americold Realty Trust COLD announced the closing of its acquisition of Agro Merchants Group, the world's fourth-largest cold storage operator. The $1.74 billion transaction was previously announced in mid-October.
The deal adds 46 facilities and 236 million cubic feet of refrigerated space to Americold's network, which now includes 239 facilities with 1.41 billion cubic feet of cold storage.
Founded in 2013, the Netherlands-based Agro built a portfolio of facilities across 10 countries in Europe, North America, South America and Australia through acquisition alongside financial partner Oaktree Capital Management. Agro's U.S. operations are headquartered in Alpharetta, Georgia.
The acquisition of Agro follows several other large deals the Atlanta-based real estate investment trust has closed in the last two years. Earlier this year, Americold acquired facilities in Florida and Texas and was selected by Ahold Delhaize USA (Koninklijke Ahold Delhaize ADRNY) to build two facilities totaling $325 million. In 2019, the company acquired Nova Cold Logistics for $250 million and Cloverleaf Cold Storage in a $1.24 billion deal.
Concurrent with the Agro closing, Americold issued 14.2 million shares to funds managed by Oaktree and to the management team at Agro. The new shares are subject to a mid-May lockup period.
A final closing pricing was not provided in the press release. The original structure included $554.3 million in Americold stock, $519 million in cash, the repayment of $560 million of Agro debt and the assumption of $110 million of Agro's capital leases and sale leaseback agreements.
The equity offering entered to facilitate the transaction increases Americold's outstanding common shares to more than 250 million, compared to 209 million at the end of the third quarter. The company still has forward equity commitments in place for more than 13 million shares. The proceeds from those issuances will be used for previously announced development and expansion projects as well as other growth initiatives.
Americold also announced an institutional private placement of 750 million euros ($920 million) of senior unsecured notes. The two tranches extend 10 and 12 years, carrying interest rates of 1.62% and 1.65%, respectively.
Citigroup C was the exclusive financial adviser to Americold on the deal with King & Spalding LLP and Freshfields Bruckhaus Deringer acting as legal advisers.
Shares of COLD were flat in early trading Thursday, in line with the S&P 500.
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