Klepierre To Buy Corio In EUR 7.2 Bln Deal

(RTTNews) - French real estate firm Klépierre S.A. and Dutch property management company Corio N.V. ( CRIOF.PK) Tuesday said they have reached conditional agreement, in a 7.2 billion euros or $9.7 billion deal, to create the leading pure play retail property company in Europe.

Corio shareholders will receive 1.14 Klépierre ordinary shares for each Corio ordinary share, valuing Corio at an enterprise value of 7.2 billion euros based on Klépierre's share price as of July 28.

The combined group will operate 182 shopping destinations in 16 European countries, with a combined gross asset value of more than 21 billion euros.

Klépierre will develop strong bases in three new countries - the Netherlands, Germany and Turkey. Corio's assets in these regions are mostly located in dynamic urban hubs with strong and sustainable demographic growth and above average purchasing power.

The Management and Supervisory Boards of both companies have unanimously recommended the terms of the transaction.

Simon Property Group (SPG) and BNP Paribas (BNPQY.PK, BNP.L), Klépierre's largest shareholders, as well as APG, Corio's largest shareholder, support the deal.

APG has agreed to irrevocably tender its 30.6 percent Corio shares to Klépierre.

The transaction will be completed by way of a recommended public exchange offer to be made by Klépierre for 100 percent of the issued and outstanding ordinary shares of Corio.

Settlement of the deal is expected in the first quarter of 2015.

The companies have identified synergies of about 60 million euros in run-rate, to be reached in 3 to 5 years, with half of the synergies driven by the incremental rental income expected from the implementation of leasing, re-tenanting, innovative marketing and specialty leasing efforts.

Laurent Morel, chairman said, "The transaction we propose today will create the leading pan-European pure player retail property company, with an unrivalled footprint in Continental Europe, a consistent portfolio of leading shopping centers and a team of seasoned professionals with deep knowledge of regional retail markets.''

Klépierre shares are intended to be listed on both Euronext Paris and Euronext Amsterdam after completion of the offer.

Klépierre and Corio may terminate the agreement in certain circumstances, including receipt of a more beneficial offer, by paying a termination fee.

Trading in both stocks are suspended today.