The transaction will be carried out on the basis of two Icade shares and cash of €32.50 in exchange for 21 Lucette shares. Approved by Icade boards and by MSREF in December, the merger was effected through a sale by MSREF of 35% of Lucette share capital prior to year end for €9.61 per share. The second step, due to take place by March 15, is a contribution of MSREF's remaining stake in Lucette on the basis of the same valuation and a reinvestment by MSREF in Icade via a reserved share capital increase.

The Lucette property portfolio was valued at €1.5 billion at June 30, 2009 and principally comprises high-quality office properties in key business districts in the Paris region. The combination will boost Icade assets under management to €5.7 billion in total, thereby making Icade the second largest office property owner among French SIICs. Icade has completely exited residential real estate, completing the final disposals in September. It said the new merged entity will enable it to strengthen the expansion of commercial real estate investment.

"The transaction represents an opportunity for MSREF to pursue its real estate strategy in France, actively contributing to the development of one of the largest French commercial property companies and to benefit from Icade's significant value creation potential," the companies said.