Kimco Realty Acquires Rival REIT Weingarten In $3.87B Deal

Kimco Realty Corp. KIM is acquiring Houston-headquartered rival Weingarten Realty Investors WRI in a deal valued at roughly $3.87 billion.

What Happened: Kimco Realty Corp. is a Jericho, New York-based real estate investment trust focused on open-air, grocery-anchored shopping centers and mixed-use assets.

Weingarten had 159 properties that will be absorbed by the 400-property Kimco, which will continue as the public company. The Kimco management team will lead the combined company with CEO Conor Flynn, Executive Chairman Milton Cooper and President/Chief Investment Officer Ross Cooper at the helm.

Weingarten shareholders will receive roughly $30.32 per share in cash and stock. Kimco shareholders are expected to own approximately 71% of the combined company’s equity while Weingarten shareholders are expected to own about 29%.

The companies stated the newly combined entity will have a pro forma equity market capitalization of roughly $12 billion and a pro forma total enterprise value of approximately $20.5 billion.

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What Happens Next: The merger will create a national operating portfolio spanning about 100 million square feet of gross leasable area. The company’s tenants include the Amazon.com Inc. AMZN subsidiary Whole Foods, Kroger Co KR, Walmart Inc WMT and TJX Companies Inc TJX.

“Combining these highly complementary platforms is a win-win for shareholders of both companies,” said Andrew “Drew” Alexander, Weingarten’s chairman, president and CEO.

“After examining the deal from every angle, it became increasingly clear that the potential of the integrated business is much greater than the sum of its parts," he continued. "The combined company’s increased size and scale, together with its financial strength, should drive an advantageous cost of capital, allowing the combined company to more readily pursue value creation opportunities.”

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(A Weingarten Realty property in Tomball, Texas. Photo courtesy Weingarten Realty.)