Shareholders will receive US$61.20 a share once the all-cash deal closes
Canada Pension Plan Investment Board and Brookfield Asset Management have agreed to take US industrial landlord LXP Industrial Trust private in an all-cash deal valued at about US$5.2bn including debt, the companies said.
The purchase expands the pension manager's exposure to warehouse and logistics property.
LXP shareholders will receive US$61.20 per share, according to the announcement.
That price represents a 12.3 percent premium to the trust's 30-day volume weighted average price and a 19.8 percent premium to its 90-day average, in each case for the period ended July 17.
For CPP Investments, the acquisition adds a large block of US logistics space at a time when the fund is leaning into the sector.
Sophie van Oosterom, managing director and head of real estate at CPP Investments, pointed to demand drivers she said would support returns over the long term.
The US industrial sector is supported by "structural demand drivers" including domestic manufacturing, shifting global supply chains and population growth across key Sunbelt markets, she said.
The partnership aims to "generate sustainable investment returns" for the CPP Fund, van Oosterom added.
The New York-listed trust owns roughly 53m square feet across 108 properties in Sunbelt and Midwest industrial markets.
Brookfield's real estate chief executive officer, Lowell Baron, said the deal fits the firm's approach of buying property with steady income and room for hands-on management.
According to the announcement, Brookfield will contribute operating expertise while CPP Investments supplies capital as a partner.
Thomas W. Eglin, Jr., chairman and chief executive officer of LXP, framed the sale as the endpoint of a multi-year push to reposition the trust as a pure-play industrial owner.
"The LXP Board unanimously determined that this transaction with Brookfield and CPP Investments fully maximizes value for our shareholders," he said.
LXP's board of trustees approved the transaction unanimously, and the parties expect to close in the fourth quarter of 2026, subject to a shareholder vote and other customary conditions, the trust said.
The deal carries no financing condition.
The agreement also opens a 40-day go-shop window that runs to 11:59 pm New York time on August 28, during which LXP may solicit rival bids.
The trust may walk away for a superior proposal if it pays a termination fee, subject to the buyer's notice and negotiation rights, though it cautioned there is no guarantee a better offer will emerge.
LXP said it does not plan to report on the process unless its board decides disclosure is warranted.
The trust has agreed to suspend common share dividends until the deal closes or the agreement ends, per the merger terms.
Once the transaction completes, LXP will delist from the New York Stock Exchange and operate as a private company.
LXP still intends to publish second-quarter results on July 29, the trust said, but will stop hosting quarterly earnings calls while the deal is pending.
