Crombie REIT Completes Acquisition of Empire Retail Portfolio

On April 22, 2008, Crombie Real Estate Investment Trust (Crombie) completed the acquisition of a portfolio of 61 retail properties from subsidiaries of Empire Company Limited (Empire) for $428.5 million. The properties represent approximately 3.3 million square feet of gross leaseable area and consist of 40 freestanding grocery stores carrying various Sobeys banners and 21 strip plazas all anchored by Sobeys bannered grocery stores. The acquisition was financed in part by Crombie's March 20, 2008, bought deal financing of 5,727,750 subscription receipts and $30 million aggregate principal amount of 7.0 per cent extendible convertible unsecured subordinated debentures for gross proceeds of $93,005,250. On closing of the acquisition, each subscription receipt was converted into one unit of Crombie and the maturity date for the debentures was extended to March 20, 2013. The remainder of the purchase price for the acquisition was satisfied by: (i) the issuance of $55 million of Class B LP Units of Crombie Limited Partnership to affiliates of Empire; (ii) a $280 million 18-month bridge financing from a Canadian Chartered bank; and (iii) a draw on Crombie's revolving credit facility. Following closing of the acquisition, Empire holds a 47.8 per cent economic and voting interest in Crombie.

Empire and Crombie were represented by Stewart McKelvey with a team that included Jim Dickson, Fraser MacFadyen, Deanne MacLeod and Candace Thomas (corporate); John McFarlane, Brian Tabor, and Lydia Bugden (real estate); Paul Festeryga and Tim Rorabeck (tax); and Andrew Burke and Gavin Stuttard (securities).

Crombie was represented by Goodmans LLP with a team that included Stephen Pincus, Bill Gorman and Daniel Jeon (corporate), Juli Morrow, Andrew Wiseman, Ken Herlin and Dan Shapira (real estate), Tom Macdonald and Jonathan Freeman (environmental) and Richard Annan (competition).


Paul W. Festeryga John S. McFarlane Ken Herlin Andrew V. Burke Stephen N. Pincus Bill Gorman Candace L. Thomas Andrew S. Wiseman Thomas M. F. Macdonald Jonathan Freeman Timothy P. Rorabeck Lydia Bugden James M. Dickson Gavin Stuttard Daniel S. Jeon Deanne MacLeod D. Fraser MacFadyen Juli Morrow Daniel Shapira Brian A. Tabor


Stewart McKelvey Goodmans LLP