Home Properties' Stock Jumps After Buyout Deal With Lone Star Funds

By Tomi KilgoreMarketWatch Pulse

Home Properties Inc.'s stock hiked up 2.8% in premarket trade Monday, after the multifamily real estate investment trust agreed to be acquired by private equity firm Lone Star Funds in a deal valued at $7.6 billion, including debt. As part of the deal, Lone Star will pay $75.23 in cash for each Home Properties stock, which represents a 3.4% premium to Friday's closing price of $72.73. The deal is expected to close in the fourth quarter. In addition, Home Properties agreed to contribute up to six properties, which includes up to 3,246 units, to multifamily REIT UDR Inc. , in exchange for a combination of cash and newly-issued shares of a new UDR subsidiary. Home Properties' stock has rallied 11% year to date through Friday, while the S&P 500 has gained 2.5%.

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