Long-income UK real estate investment trust LXi REIT has confirmed talks to buy to acquire 18 prime grocery store assets from supermarket chain Sainsbury’s for about £500m (€591m).

Following recent press speculation, the London-listed firm said it is currently in discussions to acquire the assets, predominantly located in Southern England, on a sale and leaseback basis.

LXi REIT said it expects to fund the acquisition through a mix of new equity and debt in-line with its existing borrowing policy.

“As such, the company will be discussing with potential investors the possibility of an equity raise in order to part-fund the acquisition of the target portfolio,” said LXi REIT.

The company said as no binding terms with Sainsbury’s have been agreed, there can be no certainty that the acquisition, or the associated equity raise, will take place, adding that a further announcement will be made if and when appropriate.

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