Rivals groups reach compromise on Primaris, to carve up property portfolio

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TORONTO, Cananda - A compromise has been reached by two rival groups that have been competing to buy Primaris Retail Real Estate Investment Trust (TSX:PMZ.UN), one of Canada's largest shopping mall operators.

Under the agreement, the KingSett consortium will acquire 18 Primaris properties — worth about $1.9 billion in total, including assumed debt.

Meanwhile, the rest of Primaris will be acquired by its preferred buyer — H&R Real Estate Investment Trust (TSX:HR.UN).

H&R is offering Primaris unitholders $27.98 per unit — about 65 cents per share above a previous friendly agreement between the two income trusts.

Through that part of the deal, H&R will acquire 17 existing Primaris shopping centres plus nine other properties that Primaris has agreed to purchase.

H&R has agreed to pay up to $1.28 billion of the purchase price in cash and the rest in units of the real estate trust.

Organizations: TSX, Primaris Retail Real Estate Investment Trust, HR Real Estate Investment Trust

Geographic location: TORONTO, Canada

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