A proposed merger of two leading Australian Real Estate Trusts (A-REITs) is set to create one of the country's largest publicly listed companies.
Subject to shareholder approval Novion Property Group and Federation Centres will merger later this year, in a deal that will form the third largest A-REIT, with more than $22 billion in assets under management.
The merged company will be Australia's number one owner/manager of sub-regional and outlet centres, with more than three million square metres of lettable space, and 9500 retail tenancies.
As part of the proposed deal, Novion securities holders will receive 0.8225 Federation shares, valuing their current holdings at $2.55 per unit, giving the merger entity a market capitalisation of more than $11 billion, making it an Australian Securities Exchange (ASX) top 30 business.
According to a joint statement to the ASX the merged company will create total cost savings of "at least $84 million per annum", while providing the "capability to unlock and optimise the combined development pipeline of $2.5 billion" alongside the opportunity to integrate and expand strategic partnerships.
