TORONTO — Loblaw Companies Ltd. says it will spin out its real estate investment trust to focus solely on its grocery and pharmacy business.
The company says George Weston Ltd., which has majority ownership of Loblaw, will receive its 61.6 per cent interest in Choice Properties REIT and Loblaw’s minority shareholders will received George Weston shares in exchange.
George Weston already owns 3.8 per cent of the trust and the deal would boost its position to 65.4 per cent.
The arrangement is conditional on at least two-thirds of Loblaw’s common shareholders and a majority of its minority sharesholders approving the deal in a vote at a meeting expected to take place next month, as well as court and other approvals.
The companies anticipate the transaction will close in the fourth quarter.
Loblaw president Sarah Davis says in a statement that the strategies of Loblaw and Choice Properties diverged over the past few years with the grocer focusing on its core retail business and growing in digital, healthcare and other areas.
Companies in this story: (TSX:L, TSX:WN)
The Canadian Press