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MEMPHIS, TENN. — MAA (NYSE: MAA) and Colonial Properties Trust (NYSE: CLP) have entered into a definitive merger agreement that will create a powerhouse multifamily REIT focused on the Sunbelt. The combined company is expected to have a pro forma equity market capitalization of approximately $5.1 billion and a total market capitalization of $8.6 billion.
Both the Board of Directors of MAA and Board of Trustees of Colonial Properties Trust have unanimously approved the merger, which is expected to close during the third quarter of this year.
The deal brings together two multifamily portfolios that include approximately 85,000 multifamily units in 285 properties. The combined company's 10 largest markets will be Dallas/Ft. Worth, Atlanta, Austin, Raleigh, Charlotte, Nashville, Jacksonville, Tampa, Orlando and Houston.
“The combination of MAA and Colonial Properties Trust will provide an enhanced competitive advantage across the Sunbelt region,” says H. Eric Bolton Jr., CEO of MAA. “The scale of the combined company will support accelerated growth and deployment of capital across our high-growth Sunbelt markets, driving superior value-creation opportunity for our shareholders. In addition, through capitalizing on the strengths gained from the combination of the two platforms, we will enhance our ability to serve residents across the region, drive higher margins as a result of synergies and advantages generated by the merger, and enhance career opportunities for our associates.”
Upon completion of the merger, the company will retain the MAA name and will trade under the ticker symbol MAA. Following the close of the transaction, the combined company's corporate headquarters will be located in Memphis.
Under the terms of the agreement, each Colonial Properties Trust common share will be converted into 0.36 newly issued MAA common share, and the combined company will be an UPREIT.
Birmingham, Ala.-based Colonial Properties Trust is a real estate investment trust (REIT) that acquires, manages and develops multifamily properties throughout the Sunbelt region. The REIT’s stock price closed at $22.11 per share on Friday, up from trading at $20.48 per share this time last year.
MAA is a self-managed REIT that acquires, owns and operates apartment communities across 13 states in the Sunbelt. As of March 31, MAA had an ownership interest in 49,591 apartment units. The company’s stock price closed at $67.97 per share on Friday, up from trading at $65.36 per share one year ago.
— Brittany Biddy