Gramercy Capital Corp., a New York-headquartered commercial real estate specialty finance company, and American Financial Realty Trust, a self-administered, self-managed real estate investment trust, have entered into a definitive merger agreement for Gramercy to acquire American Financial for approximately $3.4 billion, including the assumption of American Financial's outstanding debt.
The companies say that the acquisition will combine the existing operating platforms of American Financial and Gramercy to create an integrated commercial real estate finance and operating company. Under the terms of the agreement, Gramercy will acquire all of American Financial's common stock for a per-share consideration of $5.50 in cash and 0.12096 shares of Gramercy common stock.
After completion of the transaction, Gramercy expects to own approximately 27 million square feet of commercial real estate in 37 states to add to its $3.5 billion of debt investments. The transaction has been unanimously approved by both companies' boards of directors and is expected to close near the end of the first quarter of 2008, the firms add.