Buffett-Backed Seritage Jumps Most Since 2015 on $2 Billion Loan
(Bloomberg) -- Seritage Growth Properties, the real estate investment trust spun out of Sears Holdings Corp., climbed the most in more than two years after Warren Buffett's Berkshire Hathaway Inc. agreed to provide the company with a $2 billion loan.
The REIT's shares rose 11 percent to $46.91 at 10:17 a.m. in New York, the most since December 2015. The loan facility with Berkshire Hathaway Life Insurance Co. of Nebraska will help the company refinance debt and boost capital.
Berkshire's deal with Seritage extends Buffett's ties to the company. The billionaire investor disclosed a personal stake in Seritage in 2015, just a few months after the REIT was listed on the New York Stock Exchange. Seritage purchased about 254 of Sears's properties as part of its formation, an agreement in which the REIT then leased the Sears and Kmart locations back to the retailer. In recent years, Seritage has been diversifying its rental income beyond Sears.
“This new financing is a transformational step in the evolution of our company, which we started three years ago, and positions us to further accelerate our role as a leading retail and mixed-use developer across the country,” Benjamin Schall, chief executive officer of Seritage, said in a statement Tuesday.
To contact the reporter on this story: Katherine Chiglinsky in New York at kchiglinsky@bloomberg.net
To contact the editors responsible for this story: Caroline Salas Gage at csalas1@bloomberg.net, Steve Dickson, Steven Crabill
©2018 Bloomberg L.P.
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