Washington Prime gets $1.25 billion bridge loan, sells assets to fund $4.3 billion Glimcher merger

By Lisa Kerner

Charlotte, N.C., Sept. 16 – Washington Prime Group Inc. has a $1.25 billion bridge loan commitment in place with Citi to help fund its purchase of Glimcher Realty Trust. The cash and stock deal is valued at $4.3 billion, including the assumption of debt.

Additionally, Washington Prime will use proceeds of $1.09 billion from the sale of two properties to Simon Property Group, Inc. to finance the deal.

The sale of the properties, located in New Jersey and Texas, and the closing of the merger transaction are slated to close concurrently in the first quarter of 2015.

According to Washington Prime chief executive officer Mark S. Ordan, the company has “an array of opportunities” to “comfortably” fund the transaction.

These opportunities include joint ventures, assumption of mortgage debt, additional asset sales and other possible capital market transactions, said Ordan during a conference call on Tuesday. His goal is to maintain a leverage level of below seven times at the transaction’s close.

Transaction details

Under the companies’ definitive agreement, Glimcher shareholders will receive for each Glimcher share $10.40 in cash and 0.1989 of a share in WPG for a total value of $14.20.

The total equity consideration issued to Glimcher equity holders is $592 million.

Once the merger is completed, the combined company will be renamed WP Glimcher, trade on the NYSE under WPG and maintain Glimcher's headquarters location in Columbus, Ohio.

Ordan will serve as executive chairman of the board of directors. Glimcher CEO Michael P. Glimcher will serve as the combined company's vice chairman and CEO reporting to Ordan.

Michael Glimcher and one additional Glimcher board member will join the new nine-member board.

Washington Prime, a Bethesda, Md.-based real estate investment trust, went public on May 28 after spinning off from Simon.

Glimcher is a Columbus, Ohio-based real estate investment trust.

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