Colony CapitalInc. has entered into exclusive negotiations with NorthStar Asset Management Group Inc. and based ona joint proposal from Colony and NorthStar Realty for a tri-party, all-stock "atthe market" business combination based on historical trading prices.

The three companies said they believe the combination would createa diversified real estate and investment management equity REIT with significantscale, deep management talent, and the opportunity to generate substantial revenueand expense synergies.