Slate Grocery REIT has agreed to be taken private by a joint venture of Brixmor Property Group Inc. and affiliates of Everview Partners, L.P. in an all-cash transaction valued at approximately US$2.3 billion, ending a strategic review the Toronto-based trust launched in May.
Under the arrangement agreement, the purchaser will acquire all of the issued and outstanding units of the REIT for US$13.00 per unit in cash. The price represents a premium of roughly 13 percent to the units' closing price on May 21, 2026, the last trading day before the REIT announced its strategic review, and about 20 percent over the September 23, 2026 close, the day before it suspended distributions. Slate Grocery owns and operates a portfolio of 115 grocery-anchored shopping centres across the United States.
The buyers will split the portfolio. Brixmor will take 23 grocery-anchored centres totalling about three million square feet for US$636 million, acquiring full ownership of 22 properties and a 50 percent interest in one. Those assets are roughly 96 percent leased and sit within Brixmor's existing footprint, concentrated in Florida, Georgia and the Carolinas. A newly formed joint venture between Brixmor and Everview affiliates will acquire the remaining 92 centres, totalling about 12 million square feet, for US$1.71 billion. In that venture, Brixmor will hold a 20 percent common equity interest and Everview 80 percent, with Brixmor serving as asset manager, property manager and leasing representative and making a preferred equity investment of about US$174 million carrying a 9 percent dividend. A subsidiary of the Abu Dhabi Investment Authority will invest alongside Everview as a strategic investor.
The transaction is the culmination of a review the REIT began after receiving an unsolicited proposal from affiliates of Slate Asset Management (Canada) L.P., its external manager and largest investor. A special committee of independent trustees ran a competitive auction process before unanimously recommending the sale, and the board approved the agreement with interested trustees abstaining.
The deal will be carried out as a plan of arrangement under Ontario's Business Corporations Act and Trustee Act and requires approval from at least two-thirds of votes cast by unitholders, as well as a simple majority of votes cast by unitholders excluding the manager and its affiliates, under Multilateral Instrument 61-101. Trustees holding units and the manager have signed voting and support agreements covering about 5.9 percent of outstanding units. Closing also requires approval of the Ontario Superior Court of Justice and the concurrent termination of the management agreement, and may require clearance under the Investment Canada Act. The transaction carries no financing conditions, and the purchaser has provided committed debt and equity financing.
The REIT would pay a termination fee of about US$31 million in certain circumstances, including a superior proposal, while the purchaser would owe a reverse termination fee of about US$63 million if the deal fails to close in certain cases. The manager has agreed to terminate its management agreement at closing in exchange for a fixed US$50 million payment, and the purchaser will separately acquire the interest of Slate North American Essential Real Estate REIT, Inc. in its joint ventures with the REIT for about US$187.5 million.
"Following a comprehensive strategic review process, including a competitive auction process, the special committee unanimously concluded that this transaction represents the best available outcome for the REIT and its unitholders. The transaction provides unitholders with immediate liquidity and certainty of value at an attractive all-cash price, and is the culmination of a competitive process focused on maximizing value for all Unitholders," said Marc Rouleau, chairperson of the special committee, in a press release.
"This immediately accretive transaction is directly aligned with our growth strategy, adding 23 grocery-anchored centers in markets we know well, with long-standing grocer relationships we plan to grow, while further leveraging our operating platform in a capital efficient joint venture with Everview," said Brian T. Finnegan, Brixmor's chief executive officer and president, in a press release.
"This transaction reflects our conviction in grocery-anchored, open-air retail, which we expect will continue to benefit from limited new supply and durable tenant demand," said Billy Rahm, Everview's founder and chief executive officer. "We believe the portfolio is a high-quality collection of centers in attractive markets with meaningful embedded upside."
On the legal side, Fasken Martineau DuMoulin LLP and Sidley Austin LLP are acting as independent legal counsel to the special committee. The Sidley team was led by Adam Cromie and David Grubman.
Hogan Lovells Cadwalader US LLP is acting as legal counsel to Brixmor, Simpson Thacher & Bartlett LLP is acting as legal counsel to Everview, and Davies Ward Phillips & Vineberg LLP is acting as Canadian counsel to Brixmor and Everview. McCarthy Tétrault LLP is acting as legal counsel to the manager and to Slate North American Essential Real Estate REIT, Inc.
On the financial side, Evercore Group L.L.C. is acting as exclusive financial advisor to the special committee, and CIBC World Markets Inc. was retained to provide an independent fairness opinion. Raider Hill Advisors, L.L.C. is acting as exclusive special real estate advisor to the special committee. RBC Capital Markets is acting as lead financial advisor and Wells Fargo Securities as a financial advisor to Brixmor and the purchaser, with Cushman & Wakefield acting as real estate advisor to Brixmor.
Closing is expected in the first quarter of 2027. If the transaction closes after January 20, 2027, unitholders will receive additional cash consideration of US$0.002482 per unit for each day until closing.
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