Retail Properties of America is set to merge into a subsidiary of the Kite Realty Group.


The deal would create a company with “an operating portfolio of 185 open-air shopping centers with approximately 32 million square feet of their own gross lettable space,” the statement said.

RPAI has eight malls in the Chicago area, including Plaza Del Lago in Wilmette, Brickyard on Chicago’s West Side, and Oak Brook Promenade in Oak Brook.

The kite executive team would run the combined company, which would be based in Indianapolis and retain the name Kite Realty Group.

The deal will convert every Retail Properties share into 0.6230 newly issued Kite shares, the statement said that this represents a 13 percent premium on Retail Properties’ closing price on Friday, based on the closing price of kite that day.

“On a pro forma basis, upon completion of the transaction, KRG shareholders are expected to own approximately 40% of the combined company’s equity and RPAI shareholders are expected to own approximately 60%. KRG expects to assume all RPAI debt and has received funding a commitment to provide a $ 1.1 billion bridging facility

The deal is expected to close in the fourth quarter.

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