Summary
Expedia, Inc. has filed an 8-K report on April 2, 2015, detailing a significant real estate transaction. The company, through a subsidiary, has exercised its option to purchase multiple office and lab buildings in Seattle, Washington, from Immunex Corporation for $228.9 million. This acquisition is scheduled to close in the second quarter of 2015 and will be funded by Expedia's existing cash reserves. An important aspect of this deal is a leaseback agreement, where Expedia will lease the acquired property back to Immunex through the end of 2015 for most of the space and through the end of 2016 for a data center and related facilities. This indicates a strategic move by Expedia to secure valuable real estate, potentially for its own future expansion, while generating immediate rental income.
Key Highlights
- 1Expedia is acquiring Seattle office and lab buildings for $228.9 million.
- 2The transaction is being handled through a newly formed wholly owned subsidiary.
- 3The purchase price will be funded by Expedia's available cash on hand.
- 4A leaseback agreement is in place with Immunex for the acquired property.
- 5The leaseback terms are through December 31, 2015, for most buildings and through December 31, 2016, for a data center.
- 6Closing of the acquisition is anticipated during the second quarter of 2015.
- 7Expedia will forfeit a $5 million earnest money deposit if closing conditions are not met.