Parkway Properties And Thomas Properties To Merge In $1.2 Bln Stock Deal

(RTTNews) - Parkway Properties Inc. (PKY) and Thomas Properties Group Inc. (TPGI) announced that they have signed a definitive merger agreement by which Thomas Properties will merge with and into Parkway in a stock-for-stock transaction valued at about $1.2 billion.

As per the terms of the merger agreement, Thomas Properties' shareholders will receive 0.3822 shares of newly issued Parkway common stock in exchange for each share of Thomas Properties common stock, for an implied price per share of $6.26 based on Parkway's closing stock price of $16.37 on September 4, 2013.

The merger agreement was unanimously approved by the board of directors of each company following receipt of fairness opinions.

The transaction is expected to be accretive to Parkway's Funds From Operations in 2014 and beyond as a result of the significant synergies Parkway expects to achieve.

Upon consummation of the merger, James Thomas, President and Chief Executive Officer of Thomas Properties, will become Chairman of Parkway's board of directors, and Parkway's board of directors will be expanded to 10 members.

The transaction will require a majority approval by both Parkway and Thomas Properties stockholders. The stockholder meetings are expected to be held during the fourth quarter of 2013.

Thomas and affiliates of TPG Capital, the global private investment firm and Parkway stockholder, have entered into voting agreements in connection with the shareholder meetings.

The transaction is expected to close by the end of the fourth quarter of 2013, subject to the approval of stockholders of both companies, receipt of certain third party consents and other customary closing conditions.