Crombie REIT announces closing of $418 million Sobeys transaction and conversion of subscription receipts


NEW GLASGOW, NS, June 29, 2016 /CNW/ – Crombie Real Estate Investment Trust ("Crombie" or the "REIT") (TSX: CRR.UN) announced today that it has closed its previously announced $418 million purchase from wholly-owned subsidiaries of Empire Company Limited ("Empire") of: 1) a portfolio of nineteen (19) retail properties, 2) a 50% interest in three distribution centres, and 3) two parcels of development land adjacent to existing REIT properties, and investment in the renovation and expansion of 10 properties anchored by Sobeys Inc. and currently owned by Crombie (the "Transaction"), for aggregate consideration of approximately $324.6 million in cash, before customary closing adjustments, and approximately $93.4 million via the issuance to subsidiaries of Empire of 6,353,741 Class B LP Units of Crombie Limited Partnership (the "Class B LP Units"), together with the attached Special Voting Units of Crombie.

The issuance of the Class B LP Units pursuant to the Transaction was approved by Crombie's unitholders at a meeting held on June 28, 2016.  The cash portion of the Transaction consideration was financed through the application of the approximately $125.7 million net proceeds of Crombie's previously completed public offering of subscription receipts and the balance through drawings on Crombie's existing revolving term credit facilities.

As a result of the completion of the property acquisition, each of the 8,952,400 outstanding subscription receipts of Crombie has automatically been exchanged for one Unit of Crombie and a cash distribution-equivalent payment of $0.07417 (being equal to the aggregate amount of distributions paid by Crombie per Unit for which record dates have occurred since the issuance of the subscription receipts), less any applicable withholding taxes.  Trading in the subscription receipts has been halted on the Toronto Stock Exchange and Crombie expects that the subscription receipts will be delisted from the Toronto Stock Exchange after the close of markets today and that the Units issued in exchange for the subscription receipts will immediately commence trading on the Toronto Stock Exchange.

Crombie further expects that holders of subscription receipts will receive in the upcoming days the Units and the distribution equivalent payment to which they are entitled.  The Units issued today in exchange for the subscription receipts will be eligible to receive the previously announced cash distribution of $0.07417 per Unit payable on July 15, 2016 to holders of record as of June 30, 2016.

Immediately following the closing of the Transaction and the conversion of the Subscription Receipts, Empire is expected to continue to indirectly hold a 41.5% economic and voting interest in Crombie (40.3% on a fully-diluted basis). 

About Crombie
Crombie is an open-ended real estate investment trust established under, and governed by, the laws of the Province of Ontario. Crombie currently owns a portfolio of 283 retail, mixed use and office properties across Canada, comprising approximately 19.3 million square feet with a strategy to own and operate a portfolio of high quality grocery and drug store anchored shopping centres and freestanding stores primarily in Canada's top 36 markets.

This news release contains forward-looking statements that reflect the current expectations of management of Crombie about Crombie's future results, performance, achievements, prospects and opportunities. Wherever possible, words such as "continue", "may", "will", "estimate", "anticipate", "believe", "expect", "intend" and similar expressions have been used to identify these forward-looking statements, and include statements regarding Empire's expected ownership of the REIT following the closing of the Transaction. These statements reflect current beliefs and are based on information currently available to management of Crombie, and include, without limitation, statements regarding the expected timing of distribution of Units and cash payments to holders of subscription receipts. Forward-looking statements necessarily involve known and unknown risks and uncertainties.

A number of factors, including those risks discussed in the 2015 annual Management Discussion and Analysis under "Risk Management", could cause actual results, performance, achievements, prospects or opportunities to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully and a reader should not place undue reliance on the forward-looking statements. There can be no assurance that the expectations of management of Crombie will prove to be correct.

Additional information relating to Crombie can be found on Crombie's web site at or on the SEDAR web site for Canadian regulatory filings at