Spirit Realty Capital Inc. announced on Monday it has entered into a definite merger agreement with real estate investment firm Realty Income Corp.
Realty Income plans to acquire the Dallas-based net-lease REIT firm in an all-stock transaction bearing an enterprise value of about $9.3 billion, according to a news release.
Spirit’s portfolio spans 2,064 retail, industrial, and other properties in 49 states. Some of Spirit’s top tenants in its portfolio include Invited Clubs of Dallas, one of the largest owners and operators of private golf clubs in the country, in addition to Life Time Fitness and At Home, according to Spirit’s website.
Realty Income, based in San Diego, noted that the addition of the Spirit assets would create immediate and meaningful earnings accretion, in addition to to enhancing the company’s diversification and depth in its real estate portfolio.
“The merger with Spirit is yet another example of how our size, scale, and unique platform value continue to create substantial value for our shareholders,” Sumit Roy, president and CEO of Realty Income, said in a prepared statement.
“Spirit’s assets are highly complementary to our existing portfolio, extending our investments in industries that have proven to generate durable cash flows over several economic cycles. We also believe this merger will strengthen our longstanding relationships with existing clients and allow us to curate new ones with partners whose growth ambitions can accelerate alongside Realty Income,” Roy continued.
The transaction is expected to close in the first quarter of 2024. The deal is subject to customary closing conditions, including approval by Spirit shareholders.
Both Spirit and Realty Income trade on the New York Stock Exchange.
Spirit’s current base of operations is located within the Harwood District in Dallas. It is led by Jackson Hsieh, who was appointed to the chief executive role in 2017.