Slate Retail REIT is planning a substantial issuer bid to purchase for cancellation up to 4,210,526 class U units at C$12.54 apiece for a total of C$52.8 million.
The price represents a 7.5% premium over the 20-day volume-weighted average price of the units on the Toronto Stock Exchange on Jan. 9. The offer is set to be financed via cash on hand and funds available under the retail real estate investment trust's existing credit facilities, according to a release.
The issuer bid, approved by Slate Retail's board, will begin Jan. 16 and end Feb. 20 at 5 p.m. eastern time, unless extended, terminated or withdrawn by the company. Proceeds from the offer will be distributed to class U unit holders, the REIT added.
Slate Retail will suspend further purchases of class U units under existing normal course issuer bid until after the offer expires or terminates.
Additionally, the REIT said it identified a roughly $100 million pipeline of stabilized properties that it plans to sell to recycle capital into other opportunities, including the reduction of financial leverage and the repurchase of units on offer for cancellation.