updated 7/10/2006 10:46:20 AM ET 2006-07-10T14:46:20

Strip mall owner Heritage Property Investment Trust Inc. announced Sunday that it has agreed to be purchased by Centro Watt, an Australian and U.S. joint venture, in a deal worth about $3.2 billion including debt.

The Boston-based real estate investment trust announced that the partnership between Centro Properties Group, a publicly traded Australian company, and privately held Watt Commercial Properties of Los Angeles would pay $36.15 a share.

The price represents a 3.3 percent premium to Friday's close of $34.98 on the New York Stock Exchange.

Including debt, the sale value is about $3.2 billion, Heritage said. Officials at Heritage did not immediately return calls Sunday night to disclose the amount of debt. A story in the online edition of The Wall Street Journal put the debt around $1.5 billion.

Heritage owns 171 shopping centers in 30 states and focuses on grocer-anchored shopping centers.

"We are excited about the opportunity to acquire such a high quality company as Heritage, and we look forward to maintaining a high retention rate among the Heritage employees as we have been able to do in our prior acquisitions," Andrew Scott, chief executive officer of Centro Properties Group, said in a statement.

Centro Watt purchased Philadelphia-based Kramont Realty Trust in April 2005.

Heritage's board of directors unanimously approved the deal and has recommended the approval of the transaction by Heritage's stockholders. A special stockholder meeting will be held to vote.

Completion of the transaction is expected in the fourth quarter.

Thomas C. Prendergast, Heritage's chairman, president and CEO, said, "In recognizing the underlying value of the Company's real estate portfolio, the transaction announced today accomplishes Heritage's ultimate objective as a public company, which is to maximize stockholder value."

Copyright 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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