Realty Income to pay $2.9B for American Realty

The Escondido, Calif.-based Realty Income Corporation has struck a $2.9 billion deal today to buy American Realty Capital Trust and its portfolio of hundreds of retail and commercial properties, according to the New York Times. American Realty Capital Trust’s portfolio includes some 18 commercial properties in Florida, mostly made up of 7-11, CVS and Aarons brands.

Most of the $2.9 billion will go toward issuing $1.9 billion in common stock to shareholders in American Realty Capital Trust. The remaining funds will be used to repay American Realty’s $570 million worth of outstanding debt and pay another $526 million in various obligations. The acquisition will make Realty Income the nation’s 18th-largest Real Estate Investment Trust, the Times reported.

The deal has yet to receive a final shareholder vote. If approved, the acquisition is likely to close in the fourth quarter of 2012 or early 2013. [NYT] – Christopher Cameron