Essex Property Trust, BRE Properties To Combine In $15.4 Bln Transaction

(RTTNews) - Essex Property Trust, Inc. (ESS) and BRE Properties (BRE) said they have entered into a definitive agreement under which BRE Properties would combine with Essex, creating the only publicly traded West Coast pure play multifamily REIT.

The combined company is expected to have a pro forma equity market capitalization of about $10.4 billion and a total market capitalization of around $15.4 billion.

Under the terms of the agreement, each BRE common share will be converted into 0.2971 newly issued shares of Essex common stock plus $12.33 in cash.

Based on the closing stock price for Essex on December 18, this transaction is valued at $56.21 per BRE share.

On a pro forma basis, following the merger, former Essex equity holders will hold around 63 percent of the combined company's equity, and former BRE equity holders will hold about 37 percent.

The parties currently expect the transaction to close during the first quarter of 2014.

After the closing of the transaction, Essex plans to maintain its current annual dividend of $4.84 per share.