SEC Filings

Two Brixmor Directors Have Stakes In Its $2.34 Billion Slate Grocery REIT Deal

One director runs Brixmor's joint-venture partner and another runs an adviser to Slate, and both were recused from board votes.

Matteo Parrino Jonathan Ponciano

Matteo Parrino, Jonathan Ponciano

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Two Brixmor Directors Have Stakes In Its $2.34 Billion Slate Grocery REIT Deal

Brixmor's pending takeover of Slate Grocery REIT is a related-party deal: one Brixmor director runs the partner buying 92 of the 115 Slate assets, and another runs the firm advising Slate's special committee, according to the company's quarterly report filed Monday. Brixmor, which owns and operates open-air, mostly grocery-anchored shopping centers, said both directors were recused from its board's deliberations and votes.

Two directors, two sides of the deal

William D. Rahm, a Brixmor director, is founder and CEO of Everview Partners and controls its general partner.

Daniel B. Hurwitz, also a Brixmor director, is founder and CEO of Raider Hill Advisors, which advised Slate's special committee and will receive a fee of approximately $7.1 million. Rahm does not intend to stand for reelection at the 2027 annual meeting, the filing says.

The prior quarter's 10-Q reported no material related-party transactions beyond the items it listed; this one lists the Slate deal as the exception. Brixmor announced the roughly $2.34 billion transaction on September 28, according to its earnings release.

How the money is split

Brixmor will effectively buy 23 grocery-anchored centers for $636 million, a 100% interest in 22 and 50% in one. The Everview venture takes the other 92 assets for $1.71 billion, with Everview holding 80% of the common interest and Brixmor 20%.

Brixmor's share of the venture means a cash contribution of about $112 million, plus a preferred equity investment of about $174 million paying a 9% annual dividend. Brixmor will manage the venture's portfolio and earn fees.

Brixmor also secured a term loan commitment of up to $988.0 million, unsecured and senior, due 364 days after funding with a six-month extension option. It has incurred about $4.0 million of related fees, which are expensed if management decides the financing is no longer probable.

If either partner causes the venture to default and Slate terminates, the defaulting party owes 100% of the termination fee and the other side's expenses.

Liquidity and the road to closing

Brixmor entered the deal with $1.54 billion of available liquidity as of September 30. This year it bought five shopping centers, sold eight, and repaid its 2026 notes with a May bond issue, cash and disposition proceeds.

The company expects to fund roughly $988.0 million at closing through cash, debt and equity issuance and asset sales, and expects the deal to close in the first quarter of 2027 if Slate unitholders approve. Slate has set its unitholder meeting for November 25. The company's market value was $8.6 billion in Monday's session.

Brixmor holds its earnings call Tuesday, October 27, at 10:00 a.m. ET, and Slate unitholders vote on November 25.

Sources

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