Jericho, N.Y., and Houston — Kimco Realty Corp., one of North America’s largest publicly traded owners and operators of open-air, grocery-anchored shopping centers and mixed-use assets, and Weingarten Realty Investors, a grocery-anchored Sun Belt shopping center owner, manager and developer, have entered into a definitive merger agreement under which Weingarten will merge with and into Kimco, with Kimco continuing as the surviving public company. The transaction will create the preeminent open-air shopping center and mixed-use real estate owner in the country. The combined company is expected to have a pro forma equity market capitalization of approximately $12 billion and a pro forma total enterprise value of approximately $20.5 billion.
The transaction is expected to close during the second half of 2021, subject to customary closing conditions, including the approval of both Kimco and Weingarten shareholders.
The merger will create a national operating portfolio of 559 open-air grocery-anchored shopping centers and mixed-use assets comprising approximately 100 million square feet of gross leasable area. These properties are primarily concentrated in the top major metropolitan markets in the United States. The combined company is expected to benefit from increased scale and density in key Sun Belt markets, enhanced asset quality, tenant diversity, a larger redevelopment pipeline and a de-leveraged balance sheet.
“Not only will the merged company and its shareholders enjoy a larger, higher quality, more diversified portfolio with significant embedded growth opportunities, the transaction also reduces the combined company’s leverage, creating a stronger financial profile,” says Conor Flynn, Kimco’s CEO. “This combination reflects our conviction in the grocery-anchored shopping center category, which has performed well throughout the pandemic and provides last mile locations that are more valuable than ever due to their hybrid role as both shopping destinations and omnichannel fulfillment epicenters. It also gives us even greater density in the Sun Belt markets we are targeting as well as visibility into the trends shaping necessity-based retail.”
“Combining these highly complementary platforms is a win-win for shareholders of both companies,” adds Andrew “Drew” Alexander, chairman, president and CEO of Weingarten. “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.”
The number of directors on Kimco’s board of directors will be expanded to nine, with one member of the existing board of trust managers of Weingarten to be appointed to the Kimco board. Milton Cooper will continue to serve as executive chairman of the board of directors of the combined company. Mary Hogan Preusse will continue to serve as lead independent director for the combined company.
The Kimco management team will lead the combined company, with Conor Flynn as CEO, Ross Cooper as president and chief investment officer, David Jamieson as chief operating officer and Glenn G. Cohen as chief financial officer.
Upon completion of the merger, the company’s headquarters will remain in Jericho, N.Y. The company will retain the Kimco name.
Barclays and Lazard are acting as financial advisors, and Wachtell, Lipton, Rosen & Katz is acting as legal advisor to Kimco. J.P. Morgan is acting as exclusive financial advisor, and Dentons is acting as legal advisor to Weingarten.
Kimco Realty Corp. is a real estate investment trust (REIT) headquartered in Jericho, N.Y., that is one of North America’s largest publicly traded owners and operators of open-air, grocery-anchored shopping centers and mixed-use assets. As of December 31, 2020, the company owned interests in 400 U.S. shopping centers and mixed-use assets comprising 70 million square feet of gross leasable space. For more information, visit www.kimcorealty.com.
Weingarten Realty Investors is a shopping center owner, manager and developer. As of December 31, 2020, the company owned or operated under long term leases, either directly or through its interest in real estate joint ventures or partnerships, a total of 159 properties which are located in 15 states spanning the country from coast to coast. For more information, visit www.weingarten.com.
SOURCE: Kimco Realty Corp., Weingarten Realty Investors